Hillary Clinton Statement on President George Bush's Housing Proposal

"Several months and several hundred thousand foreclosure notices later, the Bush administration is beginning to adopt my proposals to address the housing crisis. In early December I called on banks to observe a moratorium on foreclosures while they modified unworkable mortgages. Secretary Paulson said of my proposal: "I don't think it makes sense to get in and intervene." [Good Morning America, 1/18/08] But today the administration is announcing an agreement with banks to observe a foreclosure moratorium. Lenders retain too much discretion over granting the moratorium, but this is at least a start. Similarly, in October I proposed empowering the state housing agencies to fight foreclosures by refinancing unaffordable mortgages (I have introduced the Mortgage Refinancing Initiative Act to accomplish this). The administration was silent on the proposal for several months, but a few weeks ago President Bush endorsed it in his State of the Union address.

"I recognized early on that we cannot jumpstart the economy without resolving the housing crisis. That is why I have called for the mortgage industry to observe a 90-day moratorium on subprime foreclosures, and a 5-year freeze in mortgage rates on subprime adjustable rate mortgages. I have called for $30 billion in assistance to states and communities to help them fight foreclosures and offset the costs associated with mounting vacancies. I have also introduced legislation to enable state housing agencies to refinance unworkable mortgages, crack down on mortgage-related fraud, and expand foreclosure prevention initiatives.

"America needs a president who leads-not follows-when economic challenges arise; a president who sees trouble on the horizon and moves swiftly to confront it. In these tough economic times, we can't afford anything less. I am the only candidate in the race with a comprehensive plan to address the foreclosure crisis. Like the Bush administration, Senator Obama has expressed skepticism about my housing proposal. But I hope that like the Bush administration, he too will eventually acknowledge that it is the right approach.

"The administration's latest initiative is welcome news, but more remains to be done. It is critical that lenders halt all subprime foreclosures, and it is critical that they freeze subprime mortgages rates in order to stop the 30 to 50 percent escalation in monthly payments that are driving defaults."