Thursday 27 October 2011
Obama Expands Mortgage Aid
The federal government's revamped mortgage-refinancing program could allow more than a million borrowers to take advantage of falling interest rates, even if the value of their homes has plummeted.
economists said more action may be needed to stabilize the ailing housing market.
The Obama administration has been criticized for housing-relief programs that failed to meet announced goals, and declined Monday to provide estimates of how many borrowers might be helped by the latest effort. Analysts at Barclays Capital estimate that between two million and three million borrowers could be eligible under the revamp.
Loans that exceed the current 125% loan-to-value limit won't be eligible to refinance until early next year, officials said.
Other homeowners will still be left out, including those whose mortgages aren't guaranteed by Fannie and Freddie and those who took out mortgages in the past 2½ years.
Mr. Obama unveiled HARP one month into his presidency. But so far, only 894,000 borrowers have used it, of which just 70,000 are significantly underwater, or owe more than their homes are worth.
economists said more action may be needed to stabilize the ailing housing market.
Loans that exceed the current 125% loan-to-value limit won't be eligible to refinance until early next year, officials said.
Other homeowners will still be left out, including those whose mortgages aren't guaranteed by Fannie and Freddie and those who took out mortgages in the past 2½ years.
Mr. Obama unveiled HARP one month into his presidency. But so far, only 894,000 borrowers have used it, of which just 70,000 are significantly underwater, or owe more than their homes are worth.
