Investors are cheering a rare bit of good news on the housing front. February home sales rose slightly over January — the first increase in seven months. That helped prompt a rally Monday on Wall Street, which was also cheered by the sweetening of the JPMorgan Chase offer for Bear Stearns from $2 per share to $10.

But while the price for the troubled investment bank was going up, home prices continued their slump. That means housing and credit will loom large as political issues this year, and Democratic presidential hopeful Hillary Clinton is calling for more aggressive government action to help struggling homeowners.

Clinton has endorsed a plan proposed earlier this month by U.S. Rep. Barney Frank and Sen. Chris Dodd that encourages restructuring home loans in danger of default. But now Clinton is calling for a more aggressive plan wherein the government would step in to buy at-risk mortgages.

Will it really matter if loans are restructured if the consumer is already behind?

The interest rates alone is enough to start thinking about bailing out.

Are there any viable solutions to this?

Christy O'Connor 

christy@oconcomarketing.com