NEW YORK (MainStreet) — The Obama administration and Congress are anxious to get the debt debate behind them so they can focus on an equally big problem: the U.S. housing market.
President Obama is reportedly ready to float several reform ideas, including having lenders write down more mortgage principal amounts to keep struggling U.S. homeowners out of foreclosure, and urging banks to extend more credit to borrowers to spur home sales.
In a July 7 Town Hall meeting organized through Twitter, President Obama says that the housing issue is as great a priority as the debt ceiling issue, although keeping people in their homes is an uphill climb.
“We’ve had to revamp our housing program several times to try to help people stay in their homes and try to start lifting home values up,” Obama says. “But of all the things we’ve done, that’s probably been the area that’s been most stubborn to us trying to solve the problem.”
President Obama does feel that the real solution to the weak housing market must come from the private sector and not from the federal government, though he admitted that both can play a big role.
“Given the size of the housing market, no federal program is going to be able to solve the housing problem. Most of this is going to be free market,” Obama said. “The one thing that we can do is make sure that for homeowners who have been responsible, didn’t buy more house than they could afford, had some tough luck because they happened to buy at the top of the market, can afford to continue to pay for that house, can afford their current mortgage, but need some relief, given the drop in value -- that we try to match them up with bankers so that each side ends up winning.”