NEWS FLASH

Obama Hints At Pressuring Banks To Cut Mortgage Principal For Underwater Homeowners | During a “Twitter town hall” today, President Obama hinted that his administration wants to apply more pressure on banks to modify mortgages for underwater homeowners, including implementing principal reductions, which reduce the overall loan amount. After claiming (dubiously) that administration programs have helped several million homeowners, Obama said, “It’s not enough, and so we’re going back to the drawing board, talking to banks, try to put some pressure on them to work with people who have mortgages to see if we can make further adjustments, make modifications more quickly and also see if there may be circumstances where reducing principal is appropriate.” Watch it:

A group of attorneys general are currently negotiating a settlement with the banks over mortgage abuses; the settlement may include requirements that the banks reduce loan principal for troubled homeowners.