There is some good news for some homeowners; there is a subprime freeze plan of action by President Bush. Many mortgage borrowers were looking for respite from interest rate hikes; especially subprime home loan borrowers with adjustable rate mortgages (ARMs) will find relief from a new plan to prevent further foreclosures.

The Bush Administration plan includes a five-year freeze on interest rate hikes for subprime mortgages holders with adjustable rate mortgages (ARMs). In the recent past there have been concerns amongst many government officials about rising mortgage corrections. The residential real estate market has had a tumultuous ride with the balance shifting in favor of home buyers.

Previously, home sellers held sway, as home prices soared, homebuilders couldn’t keep up with orders, mortgage rates were low, and interest rates were steady in the low single digits. But now home prices have shifted to more affordable levels, the housing real estate market has had a complete 180 degree change.

In order, to keep up with the changing landscape Bush has a plan that provides relief to approximately 1.2 million families out of the 1.8 million facing interest rates reset for adjustable rate mortgages in the subprime arena.

This welcome initiative comes at a focal point when foreclosures are rising and many are unable to sustain their mortgages. Bush’s plan would give hope to as many as 7 percent of home loan borrowers holding subprime mortgages, about 145, 000 homeowners.

Some action is better than any inaction, even though this plan is limited in scope. Most likely in the future there will be an expansion in the scope of the plan to include more mortgage loan borrowers.

The plan would help home loan borrowers who are incapable of making mortgage payments, if they rise above their introductory rates of their adjustable rate mortgages. The interest rates readjust to higher mortgage rates after the first two or three years of the loans.

The ARMs that qualify are the ones scheduled to reset no sooner than Jan. 1, 2008 and no later than July 31, 2010. Many borrowers not included in the program are who can continue to afford their mortgage payments even after the interest rates reset to higher levels.

The Bush plan for the subprime freeze is the first step seen by many towards a more comprehensive forgiveness program to forestall an impending major housing and mortgage market corrections in the New Year.

Many experts have rejoiced over this initiative as it is seen by them as the government is taking a more proactive role to stave off a major crisis that they were complicit in creating.