Push grows to tap into bailout for foreclosures
WASHINGTON — A top House Democrat threatened Monday to confine up the remaining half of the $700 billion financial industry rescue money unless the Bush control provides some of it conducive to borrowers facing foreclosure.
“They’re not going to get the (money) unless they get very serious about the foreclosure modifications and showing us how we’re going to get some lending out of the banks,” Rep. Barney Frank, D-Mass., told reporters after speaking at a saddle-cloth activity conference in Washington. “At this quip I don’t see that happening.”
The Treasury Department says $335 billion has been allocated from the first moiety of the program, that was enacted more than two months ago. Treasury Secretary Henry Paulson, who is overseeing the program, is weighing tapping the second $350 billion.
The main goal of the program is to get financial institutions to impart coin more freely again.
The Bush administration has focused mainly on voluntary industry efforts to soften loans, and those have not stopped the surge in foreclosures.
“Imagine how frequent foreclosures we would have on the supposition that the financial system had been allowed to collapse,” Neel Kashkari, director of the Treasury Department office overseeing the $700 billion program, said at the same conference.
But critics say many citizens and lawmakers were led to believe some of the money would fire to avoiding foreclosures and are frustrated that it has yet to do in like manner.
In a report to be released today, a special bipartisan commission chaired by dint of. former HUD Secretaries Henry Cisneros and Jack Kemp takes aim at the Bush administration for the foreclosure crisis, citing its lax enforcement of fair-housing laws and lackluster response to problems that have disproportionately hit poor and minority populations.
Labeling the system “broken,” the seven-member panel calls for the constitution of an independent agency separate from the Department of Housing and Urban Development to in addition vigorously enforce fair-housing laws.
“The founded on government needs to be in the business of acquisition things transacted,” said Kemp, who served in the Cabinet of Bush’s father. “And in accordance with duty things being so, fair-housing enforcement is not getting done. That’s why we need a new, independent mediation that won’t master mired in politics.”
Discussion at Monday’s forum focused in succession in what condition broad the government’sitting intervention should be, rather than whether the control should play a role.
The U.S. is on track for 2.25 the multitude foreclosures this year, more than double traditional levels.
