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Obama, Fed Ask Congress to Help Home Owners
1/14/2009
Fed officials along with President-Elect Obama spent Tuesday working the halls of Congress trying to drum up support for the release of the next phase of TARP rescue funds.
Part of the plan includes helping home owners facing foreclosure. Among the strategies under discussion is one designed by the Federal Deposit Insurance Corp. to pay mortgage servicers to modify loans and offer to share in losses if the loans default. Another plan would be for the Treasury to buy loans in default and then modify the mortgages to fit existing government housing programs.
According to the Fed, the “bulk” of the remaining TARP funds would be used to invest in financial institutions and banks with the government matching investments from the private sector.
Obama is making personal calls on Democrats and Republications to urge them to release the money. If the vote doesn’t go his way, he promised to veto the action and asked Democrats to save him from having to make a veto his first official action.
Source: Washington Post, Neil Irwin and David Cho (01/14/09)
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