Roughly a week after the Washington Post revealed the Obama administration is maneuvering for a continued government role in mortgage market, the New York times is reporting the administration is considering more action to strengthen the housing market. According to the times, the administration wants to ensure that any housing relief plan would, “help a broad swath of homeowners, stimulate the economy and cost next to nothing.” One such proposal that would potentially satisfy those three requirements is a broad refinancing program that would allow homeowners with government-backed mortgages to refinance them at today’s lower interest rates:
A wave of refinancing could be a strong stimulus to the economy, because it would lower consumers’ mortgage bills right away and allow them to spend elsewhere. But such a sweeping change could face opposition from the regulator who oversees Fannie Mae and Freddie Mac, and from investors in government-backed mortgage bonds.
Read the full article here: U.S. May Back Refinance Plan for Mortgages