Late Tuesday, 13 U.S. senators, including California’s Barbara Boxer, submitted a plan to boost mortgage refinancing for homeowners as soon as possible. The plan is being widely discussed across the country, and Congress might finally be getting ready to take some action.
After months of frustration by responsible homeowners seeking some assistance, it appears Congress and the Obama administration are coming around to the idea that the economy will not be stabilized until the real estate market is stabilized first. Back in September, we wrote about our frustration with Obama’s inaction regarding the real estate market. With others joining the chorus, we hope we’ve been heard.
Senators Boxer, Johnny Isakson (GA) and Robert Menendez (NJ) led the letter to administration officials Tuesday, referencing their bill introduced earlier in the year that would remove the loan-to-value limits, loan-level price adjustments and second-lien holders from the refinancing process.
“All of these changes can be accomplished administratively and we urge that you take immediate steps to do so,” the senators said. “We also support efforts to address other hurdles that have limited the success of current refinance programs, including representations and warranties, mortgage insurance, and high lender origination fees.”
This move comes on the heels of a current boom of refinancing as the average mortgage rate recently slipped to an all-time low of less than 4%. The senators claim that there are nearly 19 million Fannie and Freddie-held mortgages with rates above 5%.
“Time is of the essence and we urge you to act quickly and aggressively to ensure that responsible homeowners receive the full benefit of these lower rates,” the senators said in the letter to Treasury Secretary Timothy Geithner, HUD Secretary Shaun Donovan, FHFA Acting Director Edward DeMarco, and NEC Director Gene Sperling.
Read the full story from Housingwire here.