In a speech before Hartford business leaders, Senator Chris Dodd highlighted a mortgage bill that he hopes will pass a U.S. Senate committee this week.
Dodd, chairman of the the Senate Commitee on Banking, Housing and Urban affairs, introduced The Hope for Homeowners Act. The bill would help hundreds of thousands of homeowners, by refinancing and federally insuring home loans after loan holders agree to reduce principal.
Dodd says 7,000 people a day face foreclosure, and more than 60 percent of homeowners with subprime loans could have qualified for more affordable mortgages.
"This isn't for the speculator. It's not for the person who couldn't afford the mortgage in the first place. It's that owner-occupied residence that's in deep trouble but could have afforded a mortgage at less of a cost."
He says the housing problem needs to be solved in order to reinvigorate other sections in the economy like municipal finance, student loans, and commercial lending.
The bill passed the House last week. Dodd says President Bush and lawmakers on the senate committee have reservations about the bill's price tag, $1.7 billion over the course of ten years. Dodd says if financial giants receive a multi-billion dollar bailout then families that are at the risk of losing their homes also deserve some help.