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The U.S. housing market has encountered its fair share of struggles over the past few years. Luckily it seems things are beginning to turn around and hopefully President Obama’s plan will help boost the turn around time. What exactly does the President have planned for our housing market and will it actually work? Obama and his committee seem pretty confident in the plan they have laid-out.
There are several aspects to the plan so let’s begin with one of the main goals they hope to achieve. The plan begins with broad based refinancing, to save upwards of $3,000 for responsible homeowners. What does that mean though? It gives borrowers who are current/up to date on their mortgage payments the ability to refinance and take advantage of today’s historically low rates.
The next step the President is hoping to accomplish is pushing through the “Homeowner Bill of Rights.” This will ensure that borrowers and lenders abide by the same standards and “play nice” for once. The following is a list of what this new bill brings to the table.
- Borrowers must have access to a simple mortgage disclosure form in order to understand the loans they are taking out.
- There must be a complete disclosure of penalties and fees.
- Specific guidelines will be placed to prevent “conflicts of interest” which often wound up hurting homeowners.
- A support system to help responsible families to avoid foreclosure.
- Protection for families who may be facing inappropriate foreclosure along with the right of appeal.
You can expect to see foreclosed homes throughout the country being transformed into rental properties. Major banks and the GSE’s will be providing upwards of 12 months of forbearance for any unemployed borrowers.
The next step is the establishment of a joint investigation aimed at determining the misconduct that had, in part, caused the recent financial crisis we encountered. This will lead to establishing preventions to ensure the same mistakes will NEVER be made again.
These plans combine with the Making Home Affordable Refinance Program (HARP) will work together to help stabilize the housing market and the economy altogether. If homeowners are able to save around thousands per year on their mortgage, this money will be put to good use buying products and services and pumping more money through the economy. If President Obama is able to get congress on the same page with his plans to help homeowners will be a game changer for the US.
For more information on the Home Affordable Refinance Program (HARP) visit our previous posts or call a loan officer at 1-800-555-2098.