Obama Housing Plans vs. Reality

The Obama administration recently unveiled a string of proposals to help struggling homeowners and get the housing market back on its feet — part of the administration’s “We Can’t Wait” election year to-do list . Of course, the White House has made big promises before about helping homeowners, only to see them disappoint time and again.

Here are the latest proposals, whether they are anything new and whether they stand a chance of going anywhere.

President Obama wants to allow homeowners whose mortgages are backed by private-sector companies to refinance at lower rates through the Federal Housing Administration. (The FHA insures many mortgages [3], and it is not the same as the FHFA, the regulatory agency in charge of Fannie Mae and Freddie Mac [4].) The president stressed that the proposal would help only “responsible” homeowners who were current on their payments — to counter Republican complaints that his housing policies reward foolhardy borrowers.

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