No Bonds for Home Bailouts

The state government should not use its bonding authority to bail out upside-down homeowners, according to the official who oversees the Nevada government’s housing agencies. Mendy Elliott, director of the Department of Business and Industry, was asked by a legislative subcommittee to look into the possibility of using bonds to help homeowners who owe more on their mortgages than the homes are now worth, following a major housing market correction.The idea was to see if money raised through bond issues could be used to help such homeowners refinance.“She recommended against it basically because it would be imprudent for the state to take on that unsecured risk,” said Elisabeth Shurtleff, spokeswoman for the department. Elliott also told lawmakers that such a program could put the state’s bond rating at risk, Shurtleff said.