In his first State of the Union address of 2012, President Obama briefly discussed a pair of proposals to help the housing industry this year. Specifically, the president mentioned allowing more borrowers to refinance their mortgages, along with investigating the lending procedures of banks nationwide, according to a Huffington Post story.
On the refinancing front, the HARP program currently allows borrowers with loans guaranteed by Fannie Mae or Freddie Mac who are up-to-date on their loans to refinance their mortgages, even if they are underwater. This leaves out an estimated 2-3 million borrowers; this second group is the one Obama’s proposal would cover.
Regarding the investigation of banks, the president proposed inquiries at both the state and federal levels. The initiative’s goal would be to curb risky lending and securitization practices by such institutions.
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