Matt Stearns
www.HispanicBusiness.com
WASHINGTON -- Changing a course he set two weeks ago, Sen. John McCain called for federal aid to distressed homeowners Thursday, saying, "There is nothing more important than keeping alive the American dream to own your own home."
The Republican presidential nominee-in-waiting introduced a plan that he said would offer "deserving" homeowners the opportunity to "trade a burdensome mortgage for a manageable loan that reflects the market value of their home."
Under McCain's plan, homeowners facing foreclosure could apply for federal assistance, and the government would help them get new, affordable loans. Homes would have to be owners' primary residences, and owners would have to prove that they could afford the new loans, which would be 30-year, fixed-rate mortgages.
The new lender would receive a federal guarantee of the new mortgage.
McCain's plan would cost $3 billion to $10 billion and help as many as 400,000 homeowners, his aides said.
The plan represents a change of heart for McCain. In a high-profile economic speech in late March, McCain said he saw little federal role for helping homeowners at risk of foreclosure. He said then it was chiefly up to mortgage lenders to help homeowners, "not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers."
He did say then that he'd consider some temporary federal assistance for homeowners, but he offered no specifics, nor did he address any of the ideas for help being considered by his congressional colleagues.
Last month's tough-love message was reinforced by McCain's chief economic adviser, Doug Holtz-Eakin, who told reporters that "as harsh as it may sound, (foreclosure) may be an appropriate outcome in some cases."
McCain's Democratic opponents pounced after that speech. Sen. Hillary Clinton, D-N.Y., compared him to Herbert Hoover.
READ MORE
WASHINGTON -- Changing a course he set two weeks ago, Sen. John McCain called for federal aid to distressed homeowners Thursday, saying, "There is nothing more important than keeping alive the American dream to own your own home."
The Republican presidential nominee-in-waiting introduced a plan that he said would offer "deserving" homeowners the opportunity to "trade a burdensome mortgage for a manageable loan that reflects the market value of their home."
Under McCain's plan, homeowners facing foreclosure could apply for federal assistance, and the government would help them get new, affordable loans. Homes would have to be owners' primary residences, and owners would have to prove that they could afford the new loans, which would be 30-year, fixed-rate mortgages.
The new lender would receive a federal guarantee of the new mortgage.
McCain's plan would cost $3 billion to $10 billion and help as many as 400,000 homeowners, his aides said.
The plan represents a change of heart for McCain. In a high-profile economic speech in late March, McCain said he saw little federal role for helping homeowners at risk of foreclosure. He said then it was chiefly up to mortgage lenders to help homeowners, "not the duty of government to bail out and reward those who act irresponsibly, whether they are big banks or small borrowers."
He did say then that he'd consider some temporary federal assistance for homeowners, but he offered no specifics, nor did he address any of the ideas for help being considered by his congressional colleagues.
Last month's tough-love message was reinforced by McCain's chief economic adviser, Doug Holtz-Eakin, who told reporters that "as harsh as it may sound, (foreclosure) may be an appropriate outcome in some cases."
McCain's Democratic opponents pounced after that speech. Sen. Hillary Clinton, D-N.Y., compared him to Herbert Hoover.
READ MORE
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