McCain pushes multi billion pound mortgage plan

By Jeff Mason

BETHLEHEM, Pennsylvania (Reuters) - White House hopeful John McCain pitched a $300 billion (173.5 billion pound) plan to help struggling homeowners on Wednesday as he tried to erode an advantage held by Democratic rival Barack Obama on economic issues.

The day after a sometimes tense second presidential debate, the ailing economy again took centre stage in the White House contest.

Both candidates welcomed cuts in global interest rates, even though the reductions failed to stop the tumult on Wall Street.

Two snap polls judged Obama the winner of the Nashville, Tennessee, debate on Tuesday night. That suggested that McCain, a Republican, could be running out of chances to recast the November 4 race, which has been trending towards his Democratic opponent.

McCain offered more details on Wednesday on a plan he suggested in Nashville to have the government buy up troubled loans from people who have seen their home values fall below their debt. The loans would then be structured into more affordable mortgages.

"Under my orders as president, the secretary of the Treasury will carry out a home ownership resurgence plan," McCain told a rally in Bethlehem, Pennsylvania. "The dream of owning a home should not be crushed under the weight of bad mortgages."

The Arizona senator called the plan a "a critical first step our country must take to get through this time of crisis."

The Obama campaign dismissed the idea as "more costly and out-of-touch than we ever imagined" and noted the Treasury already had authority under a $700 billion rescue plan approved by Congress to buy up distressed debt.