Titus: Bailout should help underwater homeowners

By Lisa Mascaro

Monday, April 27, 2009 | 5:34 p.m.

WASHINGTON -- As banks begin to repay (or give back) their bailout money, Democratic Rep. Dina Titus wants the windfall to be used to help underwater homeowners in Southern Nevada.

Titus wrote a letter today to Treasury Secretary Timothy Geithner requesting that funds from the $700 billion Trouble Asset Relief Program approved by Congress last fall go toward creating a new program to help homeowners who owe more than their homes are worth.

“As you know, my district in Southern Nevada has been severely affected by the current housing crisis,” Titus wrote. Nearly 60 percent of the homes in Las Vegas have negative equity.

“I am worried that you see this problem as minor and that enough has been done to help homeowners with negative equity in their homes,” she wrote.

Titus asks that a new program be particularly geared for those homeowners who are more than 105 percent underwater.

Part of the Obama administration’s existing mortgage aid program helps those who are up to 105 percent upside down – meaning they owe, for example, $420,000 on a home now valued at $400,000.

But in Las Vegas, some homeowners would not qualify.

The Obama administration has said if families are in distress and at risk of foreclosure, another part of its program would enable them to work with their lender to have their loans reworked to a more affordable payment.

"I believe that keeping families in their homes will play a major role in stabilizing and eventually ending the housing crisis, both in Southern Nevada and throughout the country," Titus wrote.