US President Barack Obama speaks on the 2011 budget at the Capitol Hill in Washington Feb. 1, 2010. Photo:Xinhua
US President Barack Obama used a campaign push for Senate Majority Leader Harry Reid on Friday to announce a new fund to support homeowners in five states hit hardest by the US housing crisis
Housing was at the center of the financial crisis that threw the US economy into deep recession in late 2007.
While falling values have left many mortgage-holders with homes worth less than the loans on them, soaring unemployment has led to even more mortgage defaults.
Obama said he was designating $1.5 billion from the Troubled Asset Relief Program to fund programs at local housing-finance agencies in California, Florida, Nevada, Arizona and Michigan, which have seen home prices decline by more than 20 percent.
"This fund’s going to help out-of-work homeowners avoid preventable foreclosures," Obama told a meeting near Las Vegas. "It will help homeowners who owe more than their homes are worth find a way to pay their mortgages that works for both the borrowers and the lenders alike."
"There is not enough money in the Treasury to stop every foreclosure," Obama later told the local Chamber of Commerce. "But what government can do is help responsible homeowners stay in their homes."
Nevada is still struggling from the housing market crash, and Obama’s choice to make the announcement there was no accident.
The president is rallying behind Reid, a Nevada Democrat, who trails potential Republican opponents by double digits in opinion polls before November elections that could change the balance of power in the US Congress.
Reid has helped push Obama’s agenda to boost the economy, overhaul the US healthcare system and fight climate change, but Republican critics say he has neglected his home state.
Trying to limit his party’s losses in November, Obama heaped praise on Reid, say-ing the former amateur boxer "knows what he believes in and he’s willing to fight for it."
Obama also used his Nevada trip to push for a healthcare overhaul, saying reform "cannot wait" because it is vital to the economy.
The president is also expected to publish his healthcare plan as early as today or tomorrow, combining features of the two Democratic bills passed by the Senate and the House of Representatives.
The administration’s bill will aim to jump-start the stalled healthcare overhaul and comes just days ahead of a planned televised White House summit with congressional Republicans, who are calling on Democrats to start over with a far less sweeping proposal.
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