US President George W. Bush yesterday formally unveiled a plan to freeze interest rates on some sub-prime home loans for five years, setting up a potential showdown with mortgage security investors who could see their returns decline and Democrats in Congress who say the plan does not go far enough. Financial Times, The Independent, The Times
'The housing market is moving through a period of change,' Bush said at a White House ceremony to introduce the plan. Bush said, adding the US economy was 'strong enough to weather this storm'.
US home foreclosures rose to a record high between July and August as the national housing slump worsened, the Mortgage Bankers Association said. About 1.69% of all home loans were in the foreclosure process in the third quarter, up from 1.4% in the second quarter.