President Barack Obama unveiled a $75 billion plan to ease the mortgage crisis that helped trigger the country's economic crisis. Kwame Holman reports on the president's announcement and other economic news of the day.
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President Obama turned his attention to the nation's severe housing crisis today. He laid out a plan designed to help millions of Americans fight foreclosures. Kwame Holman has our lead story report.
The setting today — Mesa, Arizona — highlighted the problem. The state had nearly 120,000 foreclosures last year, third-highest in the country.
BARACK OBAMA, President of the United States: All of us are paying a price for this home mortgage crisis. And all of us will pay an even steeper price if we allow this crisis to continue to deepen, a crisis which is unraveling homeownership, the middle class, and the American dream itself.
To that end, Mr. Obama offered the Homeowner Stability Initiative. It would grant government incentives to lenders to cut monthly mortgage payments for as many as 4 million homeowners.
If lenders and homebuyers work together, and the lender agrees to offer rates that the borrower can afford, then we'll make up part of the gap between what the old payments were and what the new payments will be. Under this plan, lenders who participate will be required to reduce those payments to no more than 31 percent of a borrower's income.