The McCain campaign has a 'new housing plan' to save our economy

The campaign of Senator John McCain (R-Ariz.) says they have an answer to the current housing crisis. This answer comes in the form of the "American Homeownership Resurgence Plan". Doug Holtz-Eakin, McCain-Palin 2008 senior policy adviser, held a teleconference to outline this new plan. Holtz-Eakin said the plan would provide direct help to home owners, allowing them to stay in their homes and avoid foreclosures that would damage he property values in their neighborhoods. The plan would also provide to the housing market lower interest rates, around five percent.

Holtz-Eakin said, "Starting with the home owner and moving up, you accomplish some of the objectives of the financial stabilization plan that we've seen come out of congress and proposed by the administration in recent weeks. Senator McCain believes this is exactly the right kind of policy, providing direct help to homeowners, at the same time supporting the financial markets and keeping them from further damaging the availability of credit to mainstream America, one of the real threats to the economy at this time." Funding for the initiative would come from authorities, including the $300 billion worth of refinance capacity provided by the Federal Housing Administration (FHA) and the $700 billion provided by the Treasury Department to Congress.

Even though the FHA and the Treasury Department already have the authority pursue this plan, the McCain campaign believes stabilizing the housing markets haven't really been publicly targeted, and were originally only geared to help four-hundred or five-hundred thousand homeowners. The new plan proposes to aid homeowners on a larger-scale than the FHA and Treasury Department have planned, and therefore be a more effective supplement to the housing crisis response.

Subcommittee addresses housing crisis

This morning, the Subcommittee on Transportation, Housing and Urban Development, and Related agencies, which is under the Senate Committee on Appropriations, met to discuss the Federal Housing Administration's role in addressing the housing crisis. Assistant Secretary for Housing and Federal Housing Commissioner Brian D. Montgomery, Chief Executive Officer of NeighborWorks America Kenneth D. Wade, and Chairman-Elect of Mortgage Bankers Association David G. Kittle were all on hand to testify.

Chairman of the Subcommittee Patty Murray (WA), said in her opening statement that "this morning we are discussing the Federal Housing Administration and its role in solving our nation's housing crisis." She then states, "The housing crisis has swept across our communities. And some are now calling for the FHA to be the savior of the housing market."

In the testimony of FHA Commissioner Brian Montgomery, he responds to the part his agency has in the housing crisis. He discusses their work in helping homeowners under FHASecure, the recent work to help even more homeowners through the FHA, "the prompt need for FHA Modernization, and the proper way to provide down payment assistance."

The subcommittee took a recess until Thursday, April 17.

FHA and Congress discuss how to fix housing crisis

Today the House Financial Services committee held a full hearing on "Using the FHA (Federal Housing Administration) for Housing Stabilization and Homeownership Retention" to discuss possible solutions to the current mortgage and foreclosure crisis.


Rep. Spencer Bachus (R-AL) said the Bear Stearns intervention has set a standard for this type of government aid and has caused homeowners who "behaved responsibly" by not taking on more debts than they could afford to suffer by paying more taxes for aid programs. He and many other representatives expressed concern that a possibility for aid in paying off loans and mortgages would decrease incentive to for individuals to pay them independently.

Other representatives argued that government intervention is necessary. Rep. Gene Green (D-TX) said that although America worries about a recession, there are many people who because of this crisis are already living in a depression.

When asked if service companies make money on foreclosures, Housing and Urban Development assistant secretary and FHA commissioner Brian Montgomery said that they take no taxpayer funds except to pay salaries and similar expenses.