November 30, 2007 / 3:36 PM / 11 years ago

White House: too soon to discuss subprime loan plan

A house for sale is seen in Antioch, California November 27, 2007. REUTERS/Erin Siegal

WASHINGTON (Reuters) - The White House on Friday said it was “premature” to discuss possible new steps to address the mortgage crisis and declined to comment on reports that officials are working on a deal with lenders to freeze interest rates on some loans.

“It’s premature to talk about those discussions at this point,” White House spokesman Scott Stanzel told reporters, when pressed on whether the administration is working on a new initiative regarding the mortgage market.

Stanzel said that administration officials “certainly have been working in close consultation with the private sector and with the industry to look at ways in which we can help people keep their homes.”

In August, the Bush administration announced a series of initiatives aimed at preventing homeowners from defaulting on risky mortgages. Those included a tax-relief proposal to make it easier for some homeowners to refinance their home loans.

Economists have become increasingly concerned about the impact of the mortgage crisis, centered on subprime loans extended to riskier borrowers, on the broader U.S. economy.

The White House, in releasing its latest economic forecasts on Thursday, acknowledged that the decline in housing had been “more pronounced” than expected.

In its semiannual forecast, it cut its estimate for U.S. gross domestic product growth in 2008 to 2.7 percent from a June forecast of 3.1 percent.

Reporting by Caren Bohan; Editing by James Dalgleish

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