White House sees more housing aid needed to boost economy

Reuters News
Posted: Jul 31, 2012 1:29 PM
White House sees more housing aid needed to boost economy

WASHINGTON (Reuters) - The White House said on Friday that housing rescue programs are still needed to help homeowners who remain behind on their mortgage payments due to the housing boom and bust that helped fuel the 2007-2009 recession.

"We are far from where we want to be," White House Press Secretary Jay Carney told reporters when asked about the current state of the housing market. "We need to continue to take the steps necessary to assist responsible homeowners to keep making their payments, to stay in their homes."

While the sector is more of a bright spot in the economy this year, it remains hobbled by a glut of unsold homes flooding the market. The S&P/Case Shiller composite index of 20 metropolitan areas gained 0.9 percent in May on a seasonally adjusted basis, exceeding economists' expectations for a 0.5 percent gain.

The White House would not comment on whether or not it is prepared to take further action if the regulator for Fannie Mae and Freddie Mac fails to approve a debt forgiveness program for troubled borrowers. The Federal Housing Finance Agency, which oversees the two companies, is expected to respond to the administration soon on whether or not the two will slash loan principal amounts for those with government-backed loans.

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"It would be way premature to suggest that we don't need to take more steps to assist homeowners," Carney added.

(Reporting by Margaret Chadbourn; Editing by Will Dunham)