Is Mitt Romney really the man to solve the housing crisis? Well, consider this: Mr. Romney may not have ever struggled “to put food on the table” as folksy politicians are so fond of saying, but he has four houses. Four. So he knows a thing or two about home ownership. And, unlike some homeowners who took out mortgages and couldn’t pay them back, Mr. Romney is wealthy enough not to have to take out mortgages (although there’s a possibility that he did—the man does have the common touch, at times).
In any event, the Republican candidate has revealed his four-point plan while taking a few swings at Obama, like: “the dream of home ownership is out of reach for many Americans as a result of President Obama’s failed policies and stalled economy.”
Because Americans were doing so well with home ownership before Obama took the helm. Ha! Good one! As though the “stalled economy” and, well, the entire economic crisis weren’t a largely a result of the fact that many Americans were actually really horrible when it came to assessing risk and making responsible choices about home ownership.
Anyway, Mr. Romney would like to, and we quote: 1) responsibly sell the 200,000 vacant foreclosed homes owned by the government; 2) Facilitate foreclosure alternatives for those who cannot afford to pay their mortgage; 3) Replace complex rules with smart regulation to hold banks accountable, restore a functioning marketplace and restart lending to creditworthy borrowers; and 4) Protect taxpayers from additional risk in the future by reforming Fannie Mae and Freddie Mac.
The Washington Post does a pretty stellar job of pointing out how A) this isn’t much of a plan and B) the Obama administration is already doing a lot of these things, like proposing new ways to refinance and modify loans. And, as of Nov. 1, for example, the Federal Housing Finance Agency will enact new regulations that make it a lot easier for homeowners to conduct short sales—a key move to help those with underwater mortgages get out from the untenable housing situations.
Moreover, as the Post points out, the government has a pilot program to convert the foreclosed homes it owns into rental properties, given that’s where a lot of the demand is at the moment (people who got caught up in the whole foreclosure business the last time are wary to sign their names to another mortgage—and rightly so in a lot of cases). Besides, selling 200,000 houses is hard to do, particularly considering that banks, who also own a lot of vacant houses, haven’t had such an easy time offloading properties—and buyers are often speculators, who are happy to let properties sit vacant until prices rise.
In the end, the “plan” looks like a few nice, though vague, talking points, coming rather late in the game. In any event, it’s better than Mr. Romney’s 2011 plan. As he told the editorial board of the Las Vegas Journal Review Board last year, he thought that the foreclosure process should be allowed to “run its course and hit the bottom.”