Mortgage Foreclosure & Refinance Resource

Arizona Sen. John McCain said Tuesday that government help related to the slow housing market and resulting credit crunch should go to homeowners, not speculators. Any assistance to the financial sector should be based on preventing a major economic collapse, he said.

McCain addressed the housing market and financial problems while in California. California, Arizona, Nevada and Florida have been hit hardest by the slow housing market.

The presumptive Republican presidential nominee said he was open to various options to help homeowners and banks reeling from the market downturn. But he said that help should not go to investors or real estate speculators. He also said borrowers should make adequate down payments for loans.

“Any assistance for borrowers should be focused solely on homeowners not people who bought houses for speculative purposes, to rent or as second homes,” said McCain.

“It is not the duty of the government to bail out and reward those who act irresponsibly whether they are big banks or small borrowers,” McCain said. “Government assistance to the banking system should be based solely on preventing systematic risk that would endanger the entire financial system and the economy.”

On the Democratic side, Hillary Clinton unveiled a new four-part plan to address the nation’s housing crisis, calling for more at-risk home loans to be restructured and the creation of a panel of experts to study the problem.

She said in an earlier news release that “aggressive action” is needed to help families avoid foreclosure, a problem she blamed for exacerbating the nation’s economic woes.

“The solution I’ve proposed is a sensible way for everyone – lenders, investors, mortgage companies and borrowers – to share responsibility, keep families in their homes and stabilize our communities and our economy,” said Clinton.

Her plan would:

• Expand the federal government’s capacity to facilitate broad-based mortgage restructuring for people who can’t afford their payments in tandem with a private-sector auction of large pools of mortgages as a way to loosen credit markets and give lenders an incentive to refinance troubled loans. Specifially, she wants the Federal Housing Administration or another government agency to be ready to purchase, restructure and re-sell troubled mortgages if a private-sector auction doesn’t do it.
• Call for President George W. Bush to appoint a panel of experts “headed by a nonpartisan group of eminent leaders like (former Federal Reserve chairman) Alan Greenspan, (former Fed chairman) Paul Volcker and (former Treasury Secretary) Bob Rubin – each of whom supports one of the remaining candidates in the presidential race.” The group would report to Congress and the Bush administration within three weeks on the bast way to solve the housing crisis.
• Pass legislation that clarifies any legal issues that might discourage mortgage companies from restructuring loans by balancing the interests of mortgage investors, homeowners and the mortgage servicing companies.
• Move forward on her plan for a $30-billion Emergency Housing Fund to get money to state and local programs aimed at helping families avoid foreclosures. It would allow groups to buy foreclosed or distressed properties “putting them back into productive use” and let groups work to restructure loans of people with problems making their payments.