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June 22 (Reuters) – The Obama administration’s much-maligned program to help struggling homeowners was not meant to keep homeownership at unsustainable levels, and foreclosures are inevitable, Treasury Secretary Timothy Geithner said on Tuesday.
“This program was not designed to prevent foreclosures. It was not designed to sustain homeownership at a level that would be unachievable, imprudent to try and do,” Geithner said in testimony to the watchdog panel overseeing the $700 billion bank rescue program.
Geithner made the comments in response to a question about Treasury’s Home Affordable Modification Program from panel member Kenneth Troske, who said the increase in the homeownership rate in the past 15 years is a key source of blame for much of the housing crisis.
“My own view on the housing market is we’re not going to return to stability until we return a rate in which, you know, 65 percent of households own their own homes,” said Troske, an economics professor at the University of Kentucky.
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