President Obama released specifications of a plan on February 1 Which would help homeowners to
refinance their existing mortgage loans in hopes of shoring up the housing market.
The U.S. Department of Housing and Urban Development (FHA), believes this plan would allow buyers to conserve on average an additional $3,000 per year if they refinancing into
new loans guaranteed by the FHA, however they must be current on their present mortgage.
The estimated to cost of the plan would run between $5 billion to $10 billion. Obama claims this could be taken care of by adding a fee to large banks.
Obama went on to praise the administration for acknowledge that much more can be accomplished to put the housing market back on track. The programs revealed today will provide lenders and other shareholders added tools to assist borrowers and further renew faith in our real property mortgage system," David H. Stevens, CEO and President of the Mortgage Bankers Association, said in a statement issued on February 1. Stevens additionally stated that the MBA feels a single set of national standards will help bring back confidence and assurance in the housing marketplace for borrowers, servicers and lenders alike.
Chairman of the National Association of Home Builders, Bob Nielsen released a
"it's clear that more resolute actions are required to increase prospects for refinancing, while at the same time reduce the foreclosed home inventory and to prevent any more homes from ending up in foreclosure," Nielsen said, who said that the NAHB is looking forward to working this out with Congress and the FHA in finding constructive solutions to these issues as soon as it's doable.
This refinancing program is the latest addition to the Obama
foreclosure prevention efforts, as a follow up the he Home Affordable Refinance Program (HARP). and the Home Affordable Modification Program (HAMP).
Reports have already indicated that this latest plan faces a lengthy battle in Congress.
John Boehner (R., Ohio) House Speaker questioned reason this plan would work when other plans before it have failed.
"One more time? One more time? How many times do we have to do this?" he questioned reporters. "I donít think anyone would believe this latest idea will work." He stated that programs before this one only led to delays in "the clearing up the market," or simply letting housing prices bottom out by letting foreclosures to occur faster.
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Feb 7, 2012