Pragmatists in the Bush Administration may be gaining the upper hand, according to “Bush Readies Mortgage Aid Plan,” in Saturday’s Washington Post.
According to the article, “The Bush administration is finalizing details of a plan to rescue thousands of homeowners at risk of foreclosure by helping them refinance into more affordable mortgages backed by public funds.”
The proposal targets at least some of America’s estimated 9 million “upside down” homeowners. Under the plan, the FHA “would encourage lenders to forgive a portion of those loans and issue new, smaller mortgages in exchange for the financial backing of the federal government,” according to the article.
This appears to be a modification of a proposal by Massachusetts Democrat Barney Frank, reminding us all that politics, indeed, does “make strange bedfellows.” (I’m available, Mr. Letterman. )
We think it could be a major step in the right direction–or a major disaster. As always, “the devil is in the details.” We just hope & pray that our employees in Washington (yup–we pay their salaries!) will finally put special interests, dogma, and party politics aside long enough to work for the common good.
In the meantime, if nothing else, it’s one more illustration of what we wrote last November in “How Low Will Prices Go?”–we’re in uncharted territory this time, and nobody really knows what will happen next! (If you predicted a Barney Frank/George Bush recovery plan, please let me know so I can get your input on my stocks & the Final Four next weekend!)
SoCalRealEstateNews 