US Sen Dodd: Supports Treasury Proposal To Lower Mortgage Rates
Friday December 5th, 2008 / 0h05
By Corey Boles Of DOW JONES NEWSWIRES WASHINGTON -(Dow Jones)- Sen. Christopher Dodd, D-Ct., said Thursday he welcomed a proposal by the Treasury to encourage banks to lower interest rates for 30-year fixed-rate mortgages in an attempt to stimulate the flagging U.S. housing market. The Wall Street Journal reported Thursday that the Treasury was considering a plan to temporarily use mortgage giants Fannie Mae and Freddie Mac to put pressure on banks to lend at rates as low as 4.5%, more than a full point lower than prevailing rates for standard 30-year fixed loans. Dodd said he was in favor of the idea, but that it would do nothing to assist troubled homebuyers already locked into repayments they cannot afford. The chairman of the Senate Banking Committee also said he would be very reluctant to release the second tranche of $350 billion under the TARP program to the Treasury. He said there needed to be more oversight of the Treasury's administration of the TARP program, and that the banks needed to do more to help out troubled homeowners, struggling to stay in their homes. "I will be a very hard person to convince that this crowd deserves to have its hands on the next $350 billion without them absolutely stepping up," Dodd said. He said that more needed to be done by banks on foreclosure mitigation before Congress should consider releasing the funds. Treasury Secretary Henry Paulson hasn't formally asked for the money to be released yet. -By Corey Boles, Dow Jones Newswires; 202-862-6601; corey.boles@dowjones.com Click here to go to Dow Jones NewsPlus, a web front page of today's most important business and market news, analysis and commentary: http://www.djnewsplus.com/al?rnd=G8rN%2BJs%2FXaaSgxy4%2FPCYtg%3D%3D. You can use this link on the day this article is published and the following day.
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