Housing crisis debate goes on

Congressional Democrats and President Bush seek different approaches to the foreclosure crisis.

WASHINGTON (AP) — Democrats urged President Bush on Friday to endorse their housing assistance proposal, which would let bankruptcy judges lower payments for homeowners staring at foreclosure.

Bush touted his less-direct approach to struggling homeowners who he said sometimes need “just a little help.”

Sen. Charles E. Schumer, D-N.Y., said Bush should lean on congressional Republicans to allow votes on the Democratic measure.

“The administration refuses to step up to the plate and do what’s needed,” Schumer, chairman of the congressional Joint Economic Committee, told reporters in a conference call. “The administration joined by [congressional Republicans] in their Herbert Hoover-like attitude of do nothing, twiddle your thumbs while the economy gets worse, especially in the housing area, is not going to sit well with the American public.”

His comments came as Bush paid a quick visit to a nonprofit debt counseling center in Freehold, N.J. to rebut exactly that sort of criticism and argue his administration has acted effectively.

The administration’s moves over the past few months include expanding the Federal Housing Administration’s ability to offer refinancing to homeowners with good credit, allowing Fannie Mae and Freddie Mac to buy up more home loans, and brokering help for struggling homeowners through a private-sector mortgage industry group. That group has agreed to offer a five-year rate freeze for people who have not missed payments or a 30-day foreclosure pause for those who fall behind.

Bush again urged people in trouble to call the group, which connects homeowners with centers such as Novadebt, the one Bush visited. But as when he first announced the hot line in December, the president got the number wrong — twice. He later returned to the podium, because he said “I got to get this right,” and gave the correct number: 1-888-995-HOPE.”

The president has come out strongly against the Democrats’ housing package, warning that an overzealous governmental response to the nation’s housing woes could hurt the economy’s ability to recover long-term. Bush did not again explicitly reject the Democratic ideas Friday but implied that Washington should act carefully.

“We have a role to play at the government level, and that is to help lenders and borrowers work together to avoid foreclosure,” he said. “The housing market problems are complicated, and there’s no easy solutions. But ... we will help responsible homeowners weather a difficult period.”