White House fact sheet: Homeowner Affordability and Stability Plan
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The White House released an executive summary of its Homeowner Affordability and Stability Plan on Wednesday. There’s lots of detail in the document, but here are three major areas of focus. First:
Enabling Up to 4 Million to 5 Million Responsible Homeowners to Refinance: Mortgage rates are currently at historically low levels, providing homeowners with the opportunity to reduce their monthly payments by refinancing. But under current rules, most families who owe more than 80% of the value of their homes have a difficult time refinancing. Yet millions of responsible homeowners who put money down and made their mortgage payments on time have -- through no fault of their own -- seen the value of their homes drop low enough to make them unable to access these lower rates. As a result, the Obama administration is announcing a new program that will help as many as 4 million to 5 million responsible homeowners who took out conforming loans owned or guaranteed by Fannie Mae or Freddie Mac to refinance through those two institutions.
From the second area, Create a $75-Billion Homeowner Stability Initiative to Reach Up to 3 Million to 4 Million At-Risk Homeowners, here are the bullet points:
-- Helping Hard-Pressed Homeowners Stay in their Homes -- No Aid for Speculators -- Protecting Neighborhoods -- Providing Support for Responsible Homeowners -- Providing Loan Modifications to Bring Monthly Payments to Sustainable Levels
The third, Supporting Low Mortgage Rates by Strengthening Confidence in Fannie Mae and Freddie Mac, includes $200 billion in funding commitments.
How this plays out is not spelled out. If the earlier ‘Hope for Homeowners’ plan, which only helped several hundred homeowners, was any indication, this could be very long process.
-- Lauren Beale
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