Republican presidential candidate Herman Cain said on Wednesday that banks want to "help people" renegotiate their mortgages but that government regulations prohibit them from dong so.
"Most bankers would want to renegotiate with people on their mortgages, but I'm telling you that there are restrictions that are government-driven that is keeping them -- I've had bankers telling me this, they've been giving me lists of things that can be done. They want to help people, they really do. But it's the threat of government regulations and the threat of the Dodd-Frank bill and rolling it out," he said on CNN's "American Morning" Wednesday, following the GOP debate in Las Vegas Tuesday night.
In Las Vegas, over 80 percent of homes are underwater, and one in every 39 housing units received a foreclosure notice in the past three months.
"I would get the government off the backs of the banks, that's one of the reasons we have so many problems," Cain said. "Many of the banks can't do some of the things they want to do to help folks. A lot of the problems have to do with regulations or the threat of regulations coming out of Washington D.C."
While the Dodd-Frank bill was enacted last year, regulators are currently in the process of writing rules for the legislation.
The Huffington Post's Arthur Delaney reported that the Home Affordable Modification Program instituted by the Obama administration has resulted in fewer than 700,000 permanent modifications, while nearly a million modifications have been cancelled (the administration had hoped to modify 3-4 million mortgages). Banks have modified about 2.5 million mortgages on their own accord.
Cain's rhetoric isn't unique for the GOP. Mitt Romney said Tuesday, "Don't try to stop the foreclosure process. Let it run its course and hit the bottom," he said. (Letting the foreclosure process "hit bottom" would likely cause home prices to fall even further.) "Allow investors to buy homes, put renters in them, fix the homes up and let it turn around and come back up."
Rep. Michele Bachmann (R-Minn.) took a different approach in the GOP debate. "When you talk about housing and foreclosures, you're talking about women who are at the end of their rope because they're losing their homes," she said. "President Obama has failed you on this issue."