Feds Near Deal to Keep People in Their Homes

The Washington Post reports to today that the FDIC and Treasury Department are close to a deal that would keep people in their homes. Since NDN began its Keep People in Their Homes campaign a month and a half ago, momentum has steadily built to restore stability to the housing market.

From the Post:

Negotiators for the Treasury and Federal Deposit Insurance Corp. are nearing agreement on a plan to have the government guarantee the mortgages of millions of distressed homeowners in what would be a significant departure for the federal rescue program, which has so far directed relief exclusively to banks and other financial institutions.

The plan, which sources said could cover as many as 3 million homeowners in danger of foreclosure and cost $40 billion to $50 billion, would go well beyond previous government and private-sector initiatives. Critics say these have attracted too few lenders or offered too little aid to homeowners to stem the foreclosure crisis.

But with economic anxieties continuing to mount and political pressure growing for expanded help to homeowners, federal officials could announce a new program to cover as much as $600 billion in mortgage loans in the coming days, sources said. They spoke on condition of anonymity because the negotiations were ongoing.

"The key to our economic recovery is in addressing the root cause of this crisis -- the housing crisis," said Sen. Christopher J. Dodd (D-Conn.), chairman of the Senate Banking Committee. "Federal agencies and financial institutions must do more to modify the mortgages they hold in order to stop foreclosures and help families keep their homes."

Also, on Tuesday in the Wall Street Journal, Andrew Caplin, Thomas Cooley, Noel Cunnihgham, and Mitchell Engler wrote an op-ed called "We Can Keep People in Their Homes." NDN's argument, that arresting the financial cave-in involves, at its core, keeping people in their homes, looks to have reached the tipping point. We urge those involved in negotiations to make this a reality. 


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