"There is nothing more important than keeping alive the American dream to own your home," the likely GOP presidential nominee said in a speech before joining in a small business roundtable discussion at a Brooklyn company. "And priority number one is to keep well-meaning, deserving homeowners who are facing foreclosure in their homes."
The Bush administration and both parties in Congress are proposing varying degrees of federal help for burdened homeowners.
In proposing specific aid, McCain struck a different tone than he did in an address last month. Then, McCain said he opposed aggressive intervention by the government to solve the crisis and that he preferred only limited intervention and letting market forces play out.
Hillary Clinton called his plan a halfhearted version of her own efforts. "So now he's changed positions and is finally responding to a housing crisis that has been going on for months, but unfortunately his actions are only half-measures," the New York senator said in a statement.
Senator Barack Obama of Illinois, who promoted his own proposal for a $30 billion second economic stimulus package while campaigning in Indiana yesterday, said McCain's plan offers little in the way of solutions.
"I'm glad he's finally decided to offer a plan," Obama said in a statement released by his campaign. "Better late than never. But don't expect any real answers, don't expect it to actually help struggling families because Senator McCain's solution to the housing crisis seems a lot like the George Bush solution of sitting by and hoping it passes while families face foreclosure and watch the value of their homes erode."
Just who would be eligible depends on who applies for help, said Doug Holtz-Eakin, McCain's senior policy adviser. "It has to be someone who at the time looked like they were a sensible borrower and now they can't handle it," he said.
He said the plan would help at least some people with adjustable-rate mortgages, as opposed to 30-year fixed loans.
McCain's plan would benefit the government as well as the original lender by giving them certificates for part of the loan's original value. If the homeowner sold for more, he or she would benefit along with the government and the original lender.
