Released: July 18, 2008

States battle mortgage foreclosure threat

Source: Stephanie Armour, USA Today

Frustrated by the slow pace of federal relief, states around the country are pouring hundreds of millions of dollars into their own programs to stem the rising tide of home foreclosures.

Some state political leaders complain that federal efforts to avert foreclosures have fallen far short. North Carolina Gov. Mike Easley said in a statement this month: “We have all been looking to the federal government to step in and do something about these foreclosures, and they have done nothing. So we decided we would do it on the state level.”

At least nine states have committed more than $450 million to provide mainly subprime homeowners with emergency or short-term loans, a study by The Pew Charitable Trusts found. In some cases, states are buying foreclosed homes outright.

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