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Morning Mortgage Meltdown: G.O.P. Bends to Dems' Plans

Can't we all just get along? Maybe so, if only in the name of saving the whole damn country from foreclosure madness: Responding to their constituents' earnest protests, Republicans are crossing over to the dark side on a Democratic plan designed to stave off the mortgage meltdown by allowing the Federal Housing Administration to take on up to $300 billion in refinanced loans for troubled homeowners. The FHA would then jiggle its standards around a bit to allow the same people who qualified for jumbo loans in the first place— those with poor credit, missed payments, and debt, debt, debt— to secure government-backed loans now reserved for more solvent borrowers. In California, where high foreclosure rates keep company with even higher prices, interest rates on larger mortgages would be brought down by raising loan limits for the FHA, Fannie Mae, and Freddie Mac. The program is optional— no mortgage servicer will be required to participate. It's also designed to foil those nefarious enough to flip on the government's dime (imagine!) as Uncle Sam will collect a neat cut of the profits should homeowners choose to do so. Subsidized by fees, premiums, and funds earned from property appreciation, the two-year program is expected to cost only $3 to $6 billion. Only.
· Homeowners urge GOP to back Democrats' plan [SF Gate]