GOP Requests More Mortgage Relief for Stimulus Package

A top Republican called for more additional mortgage relief and more tax cuts in President Barack Obama’s massive economic stimulus package as Democrats conceded privately they will drop items that have drawn bipartisan criticism. Senate Minority Leader Mitch McConnell, R-Ky., told reporters Monday that “a stimulus bill must fix the main problem first, and that’s housing.” He promised that Republicans would offer a plan to have the government step in to reduce mortgage interest rates to the 4% range, which could shore up home prices and lower housing payments for millions of Americans. Most government officials are behind a mortgage modification plan that would encourage lenders to negotiate with loan modification companies, lawyers and borrowers themselves in some cases. Too many homeowners do not qualify for mortgage refinancing, so a loss mitigation alternative is imperative for homeowners that fall into this category.

The Senate planned to begin debate on the legislation Monday and the process was likely to stretch into next week. Democrats were prepared to offer amendments to add $20-$30 billion more for infrastructure programs such as roads, bridges, mass transit and water projects, according to Sen. Charles Schumer, D-N.Y. Schumer also said Democrats would support a GOP-backed idea to double a home-buyers tax credit from $7,500 to $15,000 and make it available to all home buyers instead of those purchasing their first home. The bill is a major test for Obama and Democrats controlling the Senate. There’s unrest among Democrats such as Budget Committee Chairman Kent Conrad, D-N.D., and Ben Nelson, D-Neb., who have expressed concern that many of the items in the sprawling measure won’t do much to stimulate the economy.

The price tag is already approaching $900 billion — and it’s likely to grow during Senate debate. The US Government seeks aggressive mortgage relief with federally backed loan modification programs that should help stem the foreclosure crisis.

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