There is an old truism: Charity begins at home. But no one ever said it was going to be your home, as last week’s latest federal foreclosure prevention plan demonstrates.

The Obama administration has pledged billions to help homeowners in danger of default refinance their mortgages, so that they can bring down their monthly housing payments to a level they can handle. Opponents cry foul, claiming that the government is doing nothing to help the 90 percent of mortgage holders who are responsibly making their payments. Under scrutiny, however, that argument is as empty as an unemployed man’s wallet.

These are difficult days for free-market proponents. As a recent cover of Newsweek declared, “We are all socialists now.”

Certainly, the bank bailout bill of last October was a massive government intrusion into the free workings of the financial markets. But those markets had failed, and with a fiscal Sword of Damocles hanging over the world, there seemed little choice but to keep the world’s biggest financial institutions afloat. Had they been snuffed out, the free market could not have kept up with the torrent of trouble that would have engulfed our economy.

In Massachusetts, there are hundreds of millions of dollars worth of adjustable rate mortgages that have yet to reset. What we have seen for foreclosures so far in the Bay State has been devastating. But it is merely the first half of the hurricane. The second half, in the form of more ARM resets happening in tandem with massively rising unemployment, will make what we’ve already gone through look like a sun shower.

Loan modifications are dicey propositions. Too many parts of too many loans are in the hands of too many investors: finding everyone with a stake, and getting them all to agree, is nearly impossible. And when the U.S. Comptroller of the Currency looked at the effectiveness of defaulted mortgages that had been modified, he found that roughly 60 percent were back in default within six months.

But that figure changed sharply for Ocwen Financial Co., a major subprime loan servicer. The difference was that, in the loan modifications studied by the OCC, few resulted in a lower monthly payment for the borrower. When Ocwen modified loans, it almost always resulted in lower payments – read that, payments the borrowers could afford to make on their current incomes. For Ocwen, only 24 percent of modified loans were back in trouble after six months.

That’s what makes the Obama plan so clever. Its aim is to allow at-risk borrowers to avail themselves of lower (but still market-rate) mortgages, the kinds of loans these borrowers probably couldn’t get just because the value of their homes are underwater. By allowing them to refinance, it does away with the problem of “modifying” an existing loan (and finding all the disparate parties that entails) by just creating a new loan.

The new loan will allow borrowers to lower their monthly payments: exactly the relief needed to insure they don’t lose the home to foreclosure. Ocwen’s experience shows that most of these loans will be successful. That means that taxpayers won’t actually be on the hook for this program, it will primarily be self-funding.

The benefit of this will certainly flow to those borrowers who are currently unable to refinance at better rates. But it does no harm to other homeowners who can refinance. If they want to, let them.

This is a plan that makes eminent sense in its plain simplicity. No, it won’t solve the housing problem by itself. But just because one sandbag doesn’t keep the stormwaters at bay, doesn’t mean it’s fruitless to keep putting up sandbag after sandbag.

Government funds will be used to launch this program. That alone is enough to enrage some that a few are getting a benefit at the expense of the majority. But those same people who complain about programs like these want their own home values to stop depreciating. If they think that everyone doesn’t benefit from plans like these, they have never talked to the residents of any neighborhood where a foreclosure sign was posted. Because as so many Massachusetts residents have found out, when those signs go up, the value of everyone’s home goes down.