By Peter Ricci
In tune with campaign season, President Obama is stepping up his populist rhetoric to drum up support for his home refinancing plan.
Originally announced in January during his State of the Union address, the plan would allow homeowners with private underwater mortgages to refinance under the same conditions allotted to borrowers with government-backed loans, who were covered by programs such as the Home Affordable Refinance Program, or HARP.
Under that methodology, the President has claimed that homeowners would save, on average, $3,000 a year on their mortgage payments, and according to the Wall Street Journal, he made several mentions to the plan during a stump speech on Tuesday, calling on lawmakers to adopt his proposal.
“Congress needs to help the millions of Americans who have worked hard, made their mortgage payments on time but still have been unable to refinance their mortgages with these historically low rates,” Obama said in a speech in Albany, N.Y.
According to a White House official, Obama will also make mention of the plan during a speech in Reno, Nev., where one in every 513 homes received a foreclosure filing last month.
Obama also mentioned in his speech a “handy little to-do list,” which is filled with all of his various economic initiatives for Congress.
“Hopefully we’ll just be checking off the list; just like when Michelle gives me a list, I check it off,” he said.
As the Journal notes, though, the refinancing plan still faces considerable resistance from Congressional Republicans, and at a time when housing is playing a larger and larger role in national politics. Just last week, in fact, NAR hosted a symposium on housing finance that included such heavy hitters as FHFA Acting Director Ed DeMarco and FHA Acting Commissioner Carol Galante.
The refinancing plan is hardly the only housing initiative floated by the administration. Last fall, the FHFA eliminated a score of restrictions from HARP, and since then, 750,000 homeowners have applied for the program, according to HUD Secretary Shaun Donovan. New legislation introduced by Sens. Robert Menendez, (D., N.J.) and Barbara Boxer (D., Calif.) would limit lender exposure to risk during refinancings to incentivize more refinancing activity. Another plan, by Sen. Jeff Merkley, a Democrat from Oregon, would allow GSEs to cover closing costs on loans of 20 years or less.
Perhaps the boldest plan of all is a bill introduced by Sen. Dianne Feinstein, a Democrat from California, that would allow homeowners to refinance FHA loans without government backing. Obama’s initial refinancing plan had suggested a tax on the nation’s largest banks for funding, but, according to the Journal, Feinstein’s plan suggests extending the hugely controversial loan-guarantee fees on Fannie Mae and Freddie Mac loans that were originally enacted to pay for 2011’s payroll tax cut extension to pay for the program.