McCain would buy bad homeowner mortgages

WASHINGTON – Oct. 8, 2008 – Republican presidential candidate John McCain is proposing a $300 billion program for the federal government to buy up bad home mortgages and allow homeowners to keep their houses.

McCain said: “Until we stabilize home values in America, we’re never going to start turning around and creating jobs and fixing our economy and we’ve got to get some trust and confidence back to America.”

In an unusual step, McCain announced the plan during Tuesday’s debate. He said that as president he would direct the federal government to purchase mortgages directly from homeowners and mortgage providers. The loans would be replaced with fixed-rate mortgages, ostensibly at a loss to the government.

“Is it expensive? Yes,” McCain said.