BATON BOUGE, La. (Legal Newsline)- A plan introduced by Senate Democrats aimed at helping stem the tide of foreclosures nationally would be good for Louisiana, an official told Legal Newsline." />

Louisiana AG's office backs Senate mortgage rescue plan

BATON BOUGE, La. (Legal Newsline)- A plan introduced by Senate Democrats aimed at helping stem the tide of foreclosures nationally would be good for Louisiana, an official told Legal Newsline.

Included in the package of legislation introduced this week is a plan
to rescue more than 400,000 borrowers at risk of foreclosure, and a provision that would give some first-time home buyers an $8,000 tax credit.

"The Louisiana attorney general's office welcomes any effort to help our low income families during this foreclosure crisis, whether it be with tax breaks or other means," said Trey Phillips, director of Public Protection for state Attorney General James "Buddy" Caldwell.

Congress, he said, "is uniquely situated to provide relief in the current foreclosure crisis" because the problem is bigger than any one state.

The Senate is expected to pass the legislation as soon as Tuesday. There is wide bipartisan support for much of the plan.

It calls for more than $14 billion in tax breaks over the next decade to assist homeowners, developers of low-income housing and taxpayers in the Bayou State and other areas devastated by Hurricane Katrina.

"Louisiana is especially vulnerable and perpetually exposed because of storms and hurricanes, as are our coastal neighbors," Phillips said. "We applaud congress' efforts to assist our state and others during this time."

The Senate plan would also authorize the Federal Housing Administration to help struggling home buyers obtain more affordable loans that would be backed by the federal government.

It also includes an operations overhaul of federally-backed mortgage lenders Fannie Mae and Freddie Mac.

The White House has objected, among other things, to a provision in the plan that would provide nearly $4 billion in grant money for rehabilitating foreclosed properties.

The Bush administration has threatened to veto any mortgage rescue proposal that helps lenders or housing speculators.

From Legal Newsline: Reach reporter Chris Rizo by e-mail at chrisrizo@legalnewsline.com.

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