Carter says government must help solve foreclosure crisis

Former President Jimmy Carter is emphasizing the need for the government to assist communities devastated by foreclosure. Carter, 86, spent Wednesday building homes in north Minneapolis with Habitat for Humanity. On Thursday, he helped repair homes in the Payne-Phalen neighborhood of St. Paul's East Side.

During a small roundtable discussion with reporters, Carter stressed that housing is a critical human right for people in need, both in the U.S. and around the world.

After helping to repair the home of an elderly widow in St. Paul's East Side, Carter took a seat under a tent outside.

With former Vice President Walter Mondale of Minnesota at his side, Carter offered a sober assessment of the crisis that brings him to town this week.

It came about because banks, and others, assumed that the rapid escalation in home prices would continue.

"It was a great temptation for a family that in the past couldn't get a loan, to now have the banks saying, 'Please, come take one of our loans. You don't have prove you can repay, beause we will just determine that the house will increase in value, and will cover your deficit in your own personal income.'"

Carter is in the Twin Cities with the 27th Annual Jimmy and Rosalynn Carter Work Project. This year, the project is building or rehabbing a dozen homes in north Minneapolis and 14 on St. Paul's east side. Both neighborhoods were chosen because they've been especially hard hit by the housing crisis.

Carter was strongly critical of lenders that made loans they knew would go unpaid -- and of the bundling of risky loans into securities that were sold to investors around the world.

But Carter is an optimist, and he made clear that he believes the American dream of homeownership is not lost forever.

Despite the setback the country has suffered, Carter said he's hopeful that with continued federal help, the housing market will rebound.

Minnesota has so far received about $40 million in federal neighborhood stabilization funds for foreclosure recovery. Cities around the state have used the money to acquire, demolish and rehab properties that can be saved, and to help build new homes.

Carter praised the federal government's foreclosure recovery strategy, calling it a wise investment.

"I think that this stimulation is going to refurbish these communities," said Carter. "It makes every homeowner here look around and see a really fine house going up next door, and say, 'OK, I'll repair my house because this is a good investment for the future."

To great applause, President Carter and Vice President Mondale then posed for photos with Habitat for Humanity volunteers and homeowners, including Dannie Mae McKibbins.

McKibbins, 76, a retired nurse, said she's been overwhelmed by the kindness of Carter and the volunteers who've been working on her home.

"I lost my husband three years ago," she said. "And it has just been terrible trying to keep the bushes trimmed, and trying to keep eveyrthing done."

As she rested in a chair, a crew of workers in blue t-shirts was busy painting.

"There were bushes and things they cut down, and they took old fences and they cleaned out the garage," she said. "It just looks like a new place."

McKibbins held a Bible on her lap and beamed with pride after saying goodbye to President Carter, whom she knew many years ago in Georgia.

"I think it helped a lot of us, not only St. Paul but everywhere," she said. "He won't let anybody not have a nice house. He won't let anybody be hungry. He is that type of person -- he and his wife, both."

McKibbins said she was honored to have been chosen for the Habitat program and she'll always be grateful for the humanitarian work Carter has done.

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