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The Daily Wildcat

The Daily Wildcat

 

    “President comes to Mesa, discusses plan regarding recent home foreclosures”

    President Barack Obama, top, discusses the key points in his plan to combat the increase in home foreclosures during a speech in the gymnasium at Dobson High School in Mesa. President Obama (bottom) shakes hands with people in Mesa.
    President Barack Obama, top, discusses the key points in his plan to combat the increase in home foreclosures during a speech in the gymnasium at Dobson High School in Mesa. President Obama (bottom) shakes hands with people in Mesa.

    MESA – The gymnasium of Dobson High School in Mesa, Ariz., brimmed with excitement Wednesday as President Barack Obama took the stage to announce a $75 billion plan aimed at stopping up to nine million homeowners from going into foreclosure.

    “”I’m here today to talk about a crisis unlike any we’ve ever known – but one that you know very well here in Mesa, and throughout the Valley,”” Obama said to begin his speech. “”In Phoenix and its surrounding suburbs, the American Dream is being tested by a home mortgage crisis that not only threatens the stability of our economy but also the stability of families and neighborhoods.””

    Described as “”a price well worth paying,”” President Obama announced a plan to help Americans avoid loosing their homes to foreclosure by refinancing and modifying loans for people trapped in sub-prime mortgages.

    “”It will give millions of families resigned to financial ruin a chance to rebuild,”” Obama said. “”It will prevent the worst consequences of this crisis from wreaking even greater havoc on the economy.””

    Speaking in Arizona, a state with one of the highest foreclosure rates, Obama said the collapse of the housing market led to a credit crisis, which is a fundamental factor of the country’s economic recession.

    “”The costs to a local government associated with a single foreclosure can be as high as $20,000,”” he said.

    The plan works by allowing up to five million homeowners to refinance their mortgages at lower rates through Fannie Mae or Freddie Mac, by removing restrictions on the lending institutions.

    It also aims to reduce mortgage payments to no more then 31 percent of an individual’s income and create incentives for lenders to work with borrowers to modify the terms of sub-prime loans.

    Obama stressed transparency in his plan, and assured it would not “”rescue the unscrupulous or irresponsible by throwing good taxpayer money after bad loans.””

    The president spoke in the Valley the day after signing the $787 billion stimulus bill into law on Tuesday in Denver, which he cited as a measure to create jobs and repair the economy.

    His speech lasted about 20 minutes before the president departed the building to return to Washington.

    Arizona Gov. Jan Brewer expressed some criticism to reporters after Obama’s speech, and called for more job creation.

    “”Well, the government usually steps in, and when they do, usually it creates another problem, and then we’ll see another surge and this taking place again,”” Brewer said. “”I appreciate the President of the United States coming to Arizona and trying to help us, but if you don’t have a job and you can’t afford the mortgage, then we’re going to be right back in the same situation that we’re in.””

    District 7 Rep. Raúl Grijalva (D-Ariz.), disagreed with Brewer, and said Obama’s plan is receiving criticism as a political ploy.

    “”A lot of people are saying it is too much money, that we are throwing good money after bad,”” Grijalva said. “”A lot of people that are not supporting this plan are rolling the dice that its going to fail and it’ll revive the Republican party. Well, you know they can sit there and fiddle like little birds. The rest of us know how serious this is, and we’ve got to take bold and risky steps.””

    Grijalva said that he will be working to make sure Arizona gets a “”fair share”” of federal support because of it’s dire foreclosure crisis.

    “”Here in Arizona we’ve lost 40 percent of the housing value that you and I have in our homes. That’s a disaster,”” Arizona Attorney General Terry Goddard said. “”Nobody wins in a foreclosure. The bank loses money, the community loses money, and the homeowner is decimated, so let’s stop that.””

    Goddard called the president’s plan an “”elegant first start”” to solving the mortgage crisis.

    “”I don’t know what the numbers ought to be, but we’re setting a very clear standard for the mortgage industry, that if they’re going to play, they’re going to need to play by the rules, and those rules are going to be to their benefit in the long run,”” Goddard said.

    Vince Rabago, Assistant Attorney General and UA alumnus said he has been working on predatory lending and foreclosure fraud for several years.

    “”I get calls all the time by people that have been harmed either by risky lending practices or outright fraud,”” Rabago said. “”It’s a very difficult situation, and so I’m optimistic the president’s plan, I think, is just what’s needed to sort of stop the bleeding.””

    Rabago said Obama’s plan is not going to help people who have lost their homes already, but was happy that this plan helped homeowners, not just the financial industry.

    “”He was very clear in saying that there are a number of things that this will not do,”” Rabago said. “”This is not a cure-all.””

    Maryvale High School counselor James Rivera waited in line outside of the high school for 20 hours and got to shake the President’s hand as he exited the gymnasium.

    “”For all the kids and all the families that come into my office every day (saying) they lost their cars, their house … being forced to leave their homes, I’m here to show them that they need to keep at it,”” Rivera said. “”Keep working hard and keep believing that tomorrow is going to come, the sun is going to rise, and it’ll be a better future.””

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