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But critics say his plan would wring innovation out of the mortgage market.

If President Barack Obama gets his way, consumers who take out mortgages would automatically get a normal plain loan - such as a traditional 30-year fixed-rate mortgage - unless they opted for a riskier variety.

Obama's plan to revamp financial regulation aims to protect borrowers from the confusing and high-risk mortgages that fed a pandemic of delinquencies and foreclosures which they were previously encouraged to take, led to the worst financial crisis in decades and thrust the nation into a deep recession.

Obama is expecting opposition to the plan, and cautioned Saturday in his radio address, "While I'm not spoiling for a fight, I'm ready for one."

Government officials want to make the process of getting a mortgage as simple and abuse-free as signing up for a retirement savings plan: A growing number of companies now automatically enroll new employees in 401(k) plans unless they opt out, but in leiu of the financial crisis many companies stopped matching employee contributions to their current 401(K) plans.

For mortgage brokers, though, the plan threatens to shrink the fee income some have received from encouraging the use of adjustable-rate, interest-only and other sometimes risky loans.

Obama's plan to overhaul financial regulation, unveiled last week, would create a Consumer Financial Protection Agency to monitor consumer financial products and revamp the entire home-loan process.

It's the administration's latest step to tackle the aftermath of the housing bust. The administration in March launched a $50 billion plan to give the lending industry financial incentives to modify mortgages to lower payments.

But that plan is off to a slow start. Many housing counselors say it hasn't made much of a difference nationwide because lenders have been slow or reluctant to cooperate. As of mid-June, about 50,000 borrowers were enrolled in three-month trial modifications under the plan, according to the Treasury Department. The administration initially had said up to 4 million households could be helped.

Critics in the mortgage industry are denouncing Obama's plan for government-approved mortgages. Some call it a paternalistic intrusion that would restrict borrowers' options and make loans harder to get and potentially more expensive.

Guy Cecala, publisher of Inside Mortgage Finance, a trade publication, called the idea "un-American." He said it would make the U.S. mortgage market heavily regulated, like those of Germany or France, where consumers have fewer options.

"We're a free-enterprise country," Cecala said. "We encourage innovation. This is certainly not going to encourage innovation. It will stifle it."

But others in the industry are open to the idea. A good mortgage broker should always show a borrower plenty of options, including the traditional 30-year fixed-rate loan, and explain the risks clearly, said Kevin Iverson, a mortgage broker with Reed Mortgage Corp. in Denver.

During the lending boom, unscrupulous brokers "were selling bad products because it was one of the ways people made more money," Iverson said. They focused on closing deals fast, he said, rather than building customer relationships that would endure for years.

If the Obama plan for simplifying the mortgage process is approved, here's how it might work:

The government would give its seal of approval to a handful of mortgage types - a standard 30-year fixed-rate mortgage and perhaps a few varieties of adjustable-rate loans. For a loan to get the "vanilla" label, the lender would have to verify borrowers' income and have them set aside money for property tax and insurance.

Borrowers would still be able to get mortgages that don't pass the government's vanilla test. But they would be warned about the risks.

The Obama administration faces a tough fight over its financial overhaul plan. Powerful trade groups like the American Bankers Association, for example, oppose creating a consumer financial protection agency. Even lobbying groups open to the idea of a consumer-products regulator question whether the government should suggest which mortgages are best for consumers.

"We don't want to stifle innovation, and we don't want to stifle competition," said John Courson, president of the Mortgage Bankers Association.

Traditional fixed-rate loans fell out of favor during the housing boom. They dropped from a 75 percent market share in 2002 and 2003 to around 50 percent in 2004 and 2005, according to Inside Mortgage Finance. But with the housing bubble burst and mortgage rates near historic lows, fixed-rate loans - 30-year, 15-year and other types - now account for about 95 percent of the market.

Previous efforts in Congress to crack down on mortgage abuses have fallen short. Even regulatory proposals on seemingly simple issues, like reducing the paperwork to get a loan, have devolved into battles among industry factions.

Supporters say a new consumer regulator is sorely needed. They point to academic research suggesting that consumers, faced with a difficult choice about their personal finances, tend to choose the path of least resistance. As a result, they often make poor decisions.

That's particularly true with mortgages, which require signing numerous complex documents. Many borrowers say they didn't understand the loans they signed up for during the housing boom. Some say they were surprised when their rates adjusted to much higher payments.

"These loans are so complicated that the consumers can't figure out what's going on," said Bill Apgar, senior adviser for mortgage finance at the Department of Housing and Urban Development.

The Obama plan includes other elements likely to produce drawn-out lobbying fights. For example, administration officials want to curb the fees that brokers and lenders receive tied to inflated mortgage rates.

Brokers argue such fees are a legitimate way for borrowers to afford a loan without having to come up with thousands of dollars in closing costs, because the fees can be spread over the life of a loan. They also intend to fight a plan to have their compensation linked to whether a borrower winds up defaulting.

"There's no reason that we should have to assume that risk," said Marc Savitt, president of the National Association of Mortgage Brokers. He argues that brokers merely submit loans to lenders and don't influence whether the loans are approved.

Brokers have already seen their market share dwindle, from more than 60 percent of new loans at the peak of the market to less than 20 percent now, said David Olson, president of Access Mortgage Research in Columbia, Md.

If mortgage broker fees were eliminated, "that would be the complete kiss of death" for mortgage brokers, Olson said. "That's really how they make their money."

Home Sales Climb but at a sluggish pace- median home price off 17% from a year ago.

Sales of previously occupied homes rose modestly from April to May, the third monthly increase this year.

The National Association of Realtors said Tuesday that home sales rose 2.4 percent last month to a seasonally adjusted annual rate of 4.77 million.

About one out of every three homes sold was a foreclosure or distressed/short sale. That helped drag down the median price to $173,000 - 16.8 percent below a year ago. Falling prices coupled with new rules for property appraisers have caused many transactions to fall apart or be delayed.

There has been a huge amount of telephone calls from clients about appraisal problems.

Home sales had been expected to rise to an annual pace of 4.81 million units.

One bright spot, however, was that the number of unsold homes on the market at the end of May fell 3.5 percent to nearly 3.8 million. That's a 9.6 month supply at the current sales pace.

1) Start at the curb. You would do it too, slowly driving by a potential showing to see if its even worth your efforts to schedule a showing.

2) Make it sparkle. Get your home clean as if your mother or mother-in-law is coming for a visit, not meaning pull out all the useless stuff she gives you but make it hotel clean and fresh. Remember people will look everywhere including under sinks and in cabinets. Maybe invest in a odor neutralizing air freshner that will appeal to everyone.

3) Pay attention to color and light. Too bright colors may not attract as many buyers as neutral colors. Also a neutral home appears larger and is less likely to offend someone. Open blinds to make sure there is plenty of natural light coming in.

4) Depersonalize. Let the buyer picture their stuff in your home and not struggle to see how else the home could look. Taking yourself out of the picture allows buyers to imagine themselves living there.

5) Consider replacing furniture. Think about removing or replacing worn out or outdated furniture and get rid of extra pieces.

6) Invest in new artwork. Displaying new artwork is a great way to breathe new life into a room. Photography can be used to contemporize a room and add a splash of color as well.

7) Make repairs. Repair squeaky doors, fix a leaky faucet, and fix lighting fixtures or whatever else might else need to be done.

8) Apply a fresh coat of paint. A fresh coat of paint can make a room feel instantly better. It doesn't take a lot of time or money to apply a new fresh neutral color of paint to a room. Try taupe or beige for living areas and green or blue for bathrooms.

9) Don't forget the floors. Get rid of worn out carpet and rugs. An inexpensive area rug can cover a drappy old floor.

10) Spring for new light fixtures. Renew a room by updating light fixtures, hardware, and other electrical covers. If it's tacky or older than you get it out!

WASHINGTON (MarketWatch) -- About 200,000 mortgage modifications have been worked out under the government's Making Home Affordable program, with 40,000 modification offers completed last week, Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development said on Thursday.

"We've made substantial progress in a short period of time," he said, speaking to real estate writers and reporters attending the National Association of Real Estate Editors conference, being held in Washington this week.

Donovan said that the foreclosure-prevention program has already had more results than previous government efforts to address the foreclosure problem and that the pace of modifications is increasing.

"We're beginning to get to a pace that will get to millions of modifications," he said.

A key element of the new plan is to make the mortgages "truly affordable" with a modification, he said. With the program, there's a standard 31% debt-to-income ratio, he said; a borrower's modified mortgage payment should be no more than 31% of his or her gross monthly income, according to MakingHomeAffordable.gov.

Making Home Affordable also has a refinance program, designed for homeowners who are on time with their payments but aren't able to take advantage of low mortgage rates because they owe more than their home is currently worth -- making refinancing otherwise not possible. To be eligible for the program, the borrower's loan-to-value ratio can be no higher than 105%, but James B. Lockhart III, director of the Federal Housing Finance Agency, said on Thursday at the conference that there has been talk of raising that limit.

Donovan reiterated the administration's acknowledgement that not every foreclosure can be prevented, and part of the overall foreclosure-prevention plan has been to encourage alternatives to families destined to lose their homes; a short sale, for example, wouldn't damage a homeowner's credit the way that a foreclosure would, he said. A short sale is when the home is sold for less than is owed on a mortgage, with permission of the lender; it is helpful for those underwater on their mortgages.

But while not everyone can be helped, Donovan said that not addressing the foreclosure problem would be akin to a house burning down and subsequently setting fire to the entire neighborhood. The administration believed that allowing foreclosures to continue at the pace they were "wasn't going to lead to a bottom, it would lead to a much more substantial decline than otherwise," he said, with foreclosures continuing to affect values of properties around them.

Reform minded

Donovan also looked to the future of mortgage lending, voicing support for President Obama's Wednesday announcement on regulatory reform in the financial system.

With the reforms, consumers would be able to more easily assess the risks and benefits of mortgages when shopping for one, he said. The reforms would also introduce more fairness into the mortgage process, including regulations to make sure that borrowers can indeed afford the mortgages they're getting into, Donovan added. And those in the mortgage industry would have a more vested interest in the success of the loan by retaining a portion of the credit risk when a mortgage is originated, he said.

"No longer will homeowners and investors be the only ones with skin in the game," he said.

-Marketwatch

Take steps to prevent and act fast should disaster strike.

1) Gas Leaks:

Care for your pipes. If your excavating outdoors don't dig until the utility company has marked with flags where pipes are.Don't use pipes to hang objects in your basement, or anywhere else in your house. Check to make sure gas connections to your stove aren't fraying or cracked.

Educate your family.Make sure every family member knows the basic rule of gas safety: that any time they smell an unmistakable rotten-egg odor or hear a hissing sound and can't immediately identify the source, they should get out of the house.

2) Power Outage

Don't overload the circuit. Limit the amount of appliances on one circuit. If you lose power in one part of your house its probably because your refrigerator, microwave and coffee maker are on the same circuit and running at the same time. (I can't make coffee and toast at the same time)

Back up files regularly. Consider buying a battery backup for your computer.

Stash flashlights in each room. This way when the power does go out you can quickly and easily find a flashlight.

Alert your power company about special needs. If someone in your home relies on electrial medical equipment tell your power company and your home will be one of the first turned back on.

3) Smoke alarm.

Install many. Mount one outside of each bedroom and all major areas.

Check batteries regularly. Replace batteries every year whether you think you need to or not. I replace mine every Halloween.

Keep alarms clean. Dust and debris can cause malfunctions so vacuum regularly.

4) Fire extinguishers.

Choose multipurpose. Go with one labeled ABC, one that can handel A, B, and C categories of fires and keep it handy.

Know how to use them. Pull the pin, point the nozel, squeeze the lever and sweep the nozel side to side at the base of the fire until you think it is out.

5) Frozen Pipes:

Remove garden hoses. Cut off the water supply to outdoor faucets during the winter or anytime the weather could fall below freezing.

Insulate vulnerable pipes. Using heat tape or heat cable wrap pipes anywhere heat doesn't reach.

Allow water to trickle through pipes. Even during freezing times allow a little water, hot or cold, run through pipes to keep them defrosted. Set your thermostat at 65 and keep cabinets with exposed pipes open.

6) Escape routes:

Draw a map of our house. Plan at least two escape routes for each room.

Use a flame resistant escape ladder. Make sure rooms not on ground level have an easy way out of the house in the event of an emergency.

Pick an outdoor meeting space. Choose a space everyone will remember and is far enough away from the house in the case of emergencies.

Make sure your address is visable. Emergency crews need to be able to see an address easily.

7) Know your region:

Get informed. Contact your local chapter of the American Red Cross or Federal Emergency Management Agency and ask for information about the types of disasters you may encounter.

Ask questions. Find out about community-response plans, potential sites for emergency shelters and warning procedures.

8) Make an emergency kit:

Keep survival essentials handy. Store the goods in a waterproof container and place in an accessible location. Your kit should keep essentials to keep you going for three days.

Do a disaster dry run. One weekend night, unplug the phone, turn off lights, and don't use the faucets that way you can discover what you have and what you could potentially need.

9) Have a plan:

Choose two meeting spots. That way incase your first spot is not accessible you can all meet at a second predetermined location. Choose one that is close to your home and one that is right outside your neighborhood.

Choose a contact person. This person should be a friend or family member that lives out of state. After a disaster it might be easier to call long distance than locally. As soon as possible each person should contact that person to let them know of their location and condition.