Mortgage Workouts Could be Part of Bailout

Congress is reportedly close to passing the $700 billion rescue of Wall Street.

The compromise draft of the bill, which is being hammered out Thursday, is likely to include provisions sought by Democrats to give Congress greater authority over the bailout and a plan to allow homeowners to renegotiate their mortgages so they have lower monthly payments.

The core of the plan lets the U.S. government buy up soured assets of shaky financial firms and take an ownership stake in the troubled companies to prevent them from going under and leading the country into a severe depression.

President Bush acknowledged in a prime-time television address Wednesday night that the bailout would be a "tough vote" for lawmakers. But he said failing to approve it could have dire consequences for the economy and most Americans.

"Without immediate action by Congress, America could slip into a financial panic, and a distressing scenario would unfold. Our entire economy is in danger," Bush said.

Source: The Associated Press, Julie Hirschfeld Davis (09/25/2008)