President Bush has unveiled a plan to freeze interest rates for hundreds of thousands of homeowners whose mortgages are scheduled to rise in the coming months.
President Bush stated, “There is no perfect solution. The homeowners deserve our help. The steps I’ve outlined today are a sensible response to a serious challenge.” After his speech was delivered Thursday afternoon, Bush was initially criticized for violating free market principles. However, this private sector plan would not represent the imposition of a government solution for the mortgage crisis.
“We should not bail out lenders, real estate speculators or those who made the reckless decision to buy a home they knew they could not afford,” he said.
1.2 million citizen’s would be eligible for help under the plan, but only a small fraction of that number would be subject to the rate freeze. All others will be able to receive assistance from the Federal Housing Administration while attempting to refinance their loan or secure loan principle.
Thousands of borrowers have already been sent letters about their options under this plan. The government has also constructed a new hot line, 1-888-995-HOPE, to help aid individuals drowning in debt.
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