Obama details his plan for easier mortgage refinancing over Republican opposition

Miami /
Feb.February 02, 2012 02:15 PM

President Barack Obama provided more details on his plan to alleviate distressed homeowners in hopes of igniting the economy during a speech in Virginia yesterday, BusinessWeek reported.

As first proposed in his State of the Union address, Obama wants to make it easier for underwater homeowners to refinance their mortgages with low-interest, Federal Housing Administration-backed loans. To fund the plan, he is seeking congressional approval to tax large financial institutions, a measure Congress has twice rejected in the past two years.

It’s a stark contrast from the stance taken by Mitt Romney, who famously argued the best thing for the housing market is to wait until foreclosures run their course and the market bottoms out. The Wall Street Journal reported that many Republicans, led by House Speaker John Boehner denounced Obama’s latest proposals, rendering them difficult to pass.

If approved, appraisals and tax returns would not be required for homeowners to access the lower interest rates. Instead a borrower must show proof of employment, a credit score of 580 or higher and have had no more than one delinquency in the previous six months. The FHA-backed loans could not exceed the limits set for different markets, which range up to $729,750.

“No more red tape, no more runaround from the banks,” Obama said. “A small fee on the largest financial institutions will make sure that it doesn’t add to the deficit.”

Separately, Obama also said his administration would mandate a Homeowners Bill of Rights, which would simpllify mortgage forms and better highlight costs and fees. That bill does not require congressional support.

Finally, he continued his push to sell foreclosed homes owned by Fannie Mae to investors who could maintain them as rental properties. The Federal Housing Finance Agency is exploring a similar plan, BusinessWeek reported. [BusinessWeek] and [WSJ]


Related Articles

arrow_forward_ios
Ari Pearl completes luxury apartment tower in Hallandale Beach, scores $150M refi
Ari Pearl completes luxury apartment tower in Hallandale Beach, scores $150M refi
Ari Pearl completes luxury apartment tower in Hallandale Beach, scores $150M refi
Melo nabs $248M refi for downtown Miami apartment towers
Melo nabs $248M refi for downtown Miami apartment towers
Melo nabs $248M refi for downtown Miami apartment towers
Terranova scores $55M refi of Miracle Mile portfolio in Coral Gables
Terranova scores $55M refi of Miracle Mile portfolio in Coral Gables
Terranova scores $55M refi of Miracle Mile portfolio in Coral Gables
Qatari owner of St. Regis Bal Harbour pays off Reuben Brothers with $188M refi
Qatari owner of St. Regis Bal Harbour to pay off Reuben Brothers with $188M refi
Qatari owner of St. Regis Bal Harbour to pay off Reuben Brothers with $188M refi
Abu Dhabi sovereign wealth fund scores $180M refi of Miami Beach Edition hotel
Abu Dhabi sovereign wealth fund scores $180M refi of Miami Beach Edition hotel
Abu Dhabi sovereign wealth fund scores $180M refi of Miami Beach Edition hotel
David Grutman and Pharrell’s Goodtime Hotel in South Beach scores $164M refi
David Grutman and Pharrell’s Goodtime Hotel in South Beach scores $164M refi
David Grutman and Pharrell’s Goodtime Hotel in South Beach scores $164M refi
Dr. Jose Luis Ferreira de Melo, Carlos Ferreira de Melo and Martin Ferreira de Melo of the Melo Group. (Melo Group, Miami Plaza)
Melo Group scores $99M refi for apartment tower north of downtown Miami
Melo Group scores $99M refi for apartment tower north of downtown Miami
Developer Louis Birdman (One Thousand Museum, Getty)
One Thousand Museum developers score $90M refi to stave off foreclosure
One Thousand Museum developers score $90M refi to stave off foreclosure
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...