Florida Issue Alert- McCain Resurgence Plan

Florida.JohnMcCain.com

John McCain has proposed a bold new plan, the American Homeownership Resurgence Plan, to attack the roots of the financial crisis and keep families in their homes, avoid foreclosures, save failing neighborhoods and stabilize the housing market.

Senator Obama's campaign has run misleading advertisements that blatantly distort the truth about John McCain's plan. Here is a breakdown of what the initiative actually does:

John McCain's Homeownership Resurgence Plan would purchase mortgages directly from homeowners and mortgage servicers, and replace them with manageable, fixed-rate mortgages that wi ll keep families in their homes. By purchasing the existing, failing mortgages the McCain Resurgence Plan will eliminate uncertainty over defaults, support the value of mortgage-backed derivatives and alleviate risks that are freezing financial markets.

The new mortgage would be an FHA-guaranteed fixed-rate mortgage at terms manageable for the homeowner.

The McCain Resurgence Plan would ONLY be available to mortgage holders that:

Live in the home (primary residence only)

Can prove their creditworthiness at the time of the original loan (no falsifications and provided they made a down payment)

There are Two Very Important Things to Remember About the McCain Resurgence Plan:

The plan does not call for new spending. The plan would use some of the $700 billion authorized for the Emergency Economic Stabilization Act and would also tap other accounts. The direct cost of this plan would be roughly $300 billion because the purchase of mortgages would relieve homeowners of "negative equity" in some homes. Funds already provided by Congress in recent financial market stabilization bill will be used for this purpose.

This initiative is designed to save money and focus on the root of this problem. By attacking the root of the financial crisis -- mortgages that are "under water" because of falling house prices, unmanageable payments, and rising defaults -- the government won't be forced to buy so many distressed assets from big banks, so the total cost to taxpayers in the long run will be lowered.

America's families are bearing a heavy burden from falling housing prices, mortgage delinquencies, foreclosures, and a weak economy. John McCain recognizes how important it is that those fa milies who have worked hard enough to finance homeownership not have that dream crushed under the weight of a tough economy and the wrong mortgage.