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Kerry mortgage to help fund race

SALEM, N. H. -- Senator John F. Kerry recently loaned $850,000 to his struggling presidential campaign to pay staff salaries and other expenses, and is now scouting banks for a multimillion-dollar mortgage package on his Beacon Hill home, campaign officials said yesterday.

Kerry, the first candidate in the presidential race to make a loan to himself, will use the cash to mount an onslaught next month of television advertising, campaign swings, and other efforts to catch up to Howard Dean, his better-funded chief rival for the Democratic nomination, advisers say.

Yet there's also a huge symbolic value to the loans, several top Kerry fund-raisers say: Kerry is sending a signal to donors that they should not walk away from his candidacy, because he is far from giving up on it, in spite of a slew of recent opinion polls showing him trailing Dean.

In recent days, campaign aides have held conference calls and sent e-mail messages to top Kerry fund-raisers, urging them to spread the word about the personal loans to potential donors to shore up their support.

"There are definitely skeptical donors out there, people who see Kerry far down in the polls and aren't hearing much good news," said a top Kerry fund-raiser, who cited a new poll that had Kerry in sixth place among voters nationwide and slightly behind Al Sharpton, whom most Democratic leaders rate as a fringe candidate. "Sharpton was a bit of bad news. This is a bit of good news."

Kerry, who said in mid-November that he would seek a loan to compete aggressively against both Dean and President Bush, chose to make a quick infusion of $850,000 during the last week from a personal bank credit line. This funding will go toward expenses the campaign had to pay and had to make plans for a crucial phase of the campaign leading up to the Jan. 19 Iowa caucuses, campaign advisers say.

The senator chose not to wait for the larger loan against his home because he is unsure when that loan will be secured; advisers said they hoped it would be in hand in two weeks.

"This money isn't for bumper stickers," said his campaign spokesman, Michael Meehan.

A campaign aide said Kerry's lawyers were speaking to more than one bank about the home mortgage package, negotiating over interest rates, the size of the loan, and other terms. His Beacon Hill manse, which he owns with his wife, Teresa Heinz Kerry, is believed to be worth between $7 million and "eight figures," the campaign aides said.

In a brief interview in Salem last night, Kerry said that his home does not currently carry a mortgage, and that he had authorized his lawyers to work out the best agreement. "It's all in the hands of lawyers," Kerry said. "I haven't signed any papers."

Kerry and his spokesman, Meehan, said they could not predict the final amount of the home loan because it has not been secured yet, but the campaign will announce the details once the loan is made.

Asked if the campaign was running low on funds, Kerry said that cash is not a problem, emphasizing that he has been "fund-raising like crazy." He said he made the $850,000 loan because "we've got to bulk up a little bit" now in Iowa and New Hampshire in advance of the late-January nominating contests there.

"It's time to spend some money," Kerry said.

In the campaign's latest fund-raising report, through Sept. 30, Kerry was listed as having raised about $20 million and as having $7.9 million left on hand.

Since, he has stepped up his campaign, adding staff, opening new offices across the country, and broadcasting numerous television commercials.

Meehan declined to give a figure for cash on hand. Several Kerry fund-raisers said in interviews that donations have been under the target, but they attributed that to last-minute check-writing during the holiday season rather than a lack of support for Kerry. The campaign hopes to have raised about $4 million for the period between Oct. 1 and Dec. 31.

Kerry will also "explore additional mechanisms to finance his campaign as needed should funds become necessary," his campaign manager, Mary Beth Cahill, said in a statement. "Senator Kerry will keep all his options open under the law on further funding of the campaign."

Meehan declined to elaborate on the "additional mechanisms," but noted that Kerry has a variety of assets. The senator, in his latest financial disclosure form, listed holdings in 2002 in his own name worth $409,000 to $1.8 million, plus assets held jointly with his wife, valued at $300,000 to $600,000. The joint assets include a painting worth $250,001 to $500,000 and a bank account worth $50,001 to $100,000.

Kerry's personal wealth is dwarfed by his wife's, the Heinz ketchup heiress, who is worth roughly a half-billion dollars. Federal law prevents Teresa Heinz Kerry from donating large sums to John Kerry, but both she and the senator have left open the option that she could act independently of the campaign to attack Dean, other Democrats, or Bush, on her own behalf.

Several people who raise money for Kerry hailed yesterday's news as a shot in the arm for donors whose enthusiam for Kerry may be flagging.

In a poll released yesterday by the American Research Group, Kerry was found to be trailingDean by 25 percentage points among New Hampshire voters -- a sizable gap, though it represents a gain of seven points for Kerry since the group's last poll in early December.

Kerry appears to be in even greater trouble nationally, after several weeks campaigning heavily in Iowa and New Hampshire while visiting other key primary states only sporadically. According to a poll conducted for The New York Times and CBS News, and also published yesterday, Kerry is running sixth in the Democratic field of nine.

Kerry advisers downplayed the national poll yesterday by arguing that only voters in states with early nominating contests like Iowa and New Hampshire are starting to pay attention to the race.

"What Kerry's doing is very, very helpful to most of us who are raising money because it's a very difficult time to do that, a lot of political uncertainty about the race," said Ben Barnes, a former Texas lieutenant governor and a top Kerry fund-raiser.

Another Kerry fund-raiser, who spoke on condition of anonymity, said yesterday that there was a debate within the campaign about sharing news of Kerry's contribution -- specifically, that some campaign officials were "reticent" for fear that private giving to Kerry would "dry up" if donors thought he could get by on his own funds.

But this fund-raiser and others said the news would be welcomed as a sign of Kerry's seriousness.

"He's clearly staking a lot on this race," said Cameron Kerry, the senator's brother and another key campaign fund-raiser.

Patrick Healy can be reached at phealy@globe.com.

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