Forum calls for housing priority

Speakers at the Legislative and Political Forum called for the housing market to become a priority to the nation's public policy agenda, as it affects all Americans.

Alex Castellanos, political media consultant, said the nation cannot move out of the recession until the housing market has recovered. Rather than reduce or eliminate the mortgage interest reduction, he recommends the government cut spending to give money back to struggling Americans.

"Taking away the mortgage interest deduction would let even more air out of the balloon and be devastating to the housing market and the economy," said Castellanos. "I don't anticipate changes to mortgage interest deduction."

One way the government is working toward helping struggling homeowners is through the use of bailout money given to banks to avoid a credit crisis. The Courier Journal of Louisville, Kentucky, reported that unspent money from the 2008 federal bank bailout has been allocated to struggling home owners to help make their mortgage payments. The state is requiring major mortgage lenders that received federal funding a few years ago to avoid going under to offer forgiveness to some homeowners facing default, while the state is paying the banks to make up for lost charges and fees.

States all over the country are approving struggling homeowners for the forgiveness program, the source reported. Kentucky has approved 682 homeowners so far, while Indiana has approved 53 homeowners as of September 30, but an increase in approvals is expected for October.

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