Romney Won’t Help 11.5 Million Americans With Underwater Mortgages, Top Adviser Says

Mitt Romney won’t offer “targeted relief for the 11.5 million American homeowners who owe more on their mortgages than their homes are worth,” Lanhee Chen, his campaign’s policy director, told Bloomberg’s Al Hunt. Chen described such policies as insufficient for stabilizing the housing market:

HUNT: There are, as you know, 11.5 million Americans with underwater mortgages. Will Governor Romney do anything to help them immediately, or is this something that the market just has to work out? […]

CHEN: Governor Romney has indicated that there are some steps we ought to take to ensure that we’re growing our economy. But on the housing market specifically, I do think we have to resist the temptation for short-term approaches. And I think the President has fallen into that trap a little bit…. We have to do everything we can to get this economy going because ultimately that’s what’s going to get the housing market going again.

Watch it (at 6:00):

Chen’s comments are a departure in tone from what Romney himself told voters in Florida — the seventh in the nation in foreclosures — while campaigning against Newt Gingrich for the Republican presidential nomination. In January, the former Massachusetts governor said at a roundtable that banks should, in fact, write down mortgage principal — the amount outstanding on a mortgage — for borrowers who find themselves with a mortgage that costs more than their house is currently worth.

“The idea that somehow this is going to cure itself all by itself is probably not real,” Romney said. “There’s going to have to be a much more concerted effort to work with the lending institutions and help them take action which is in their best interest and the best interest of the homeowners.”

Those remarks came after Romney told the editorial board of the Las Vegas Review-Journal that the government should not try and prevent foreclosures. “Let it run its course and hit the bottom,” he said. However, he did add that “I think the idea of helping people refinance homes to stay in them is one that’s worth further consideration.” Indeed, some of Romney’s top economic advisers support President Obama’s efforts to help homeowners take advantage of low interest rates and refinance their mortgages.

But Chen is implying that the campaign has considered and now rejected the idea. And that’s a shame, since continued foreclosures are in nobody’s interest and will only hamper the nation’s economic recovery.