Obama Claims Credit for Refinancing Surge; Critics Doubt Policies’ Role, Impact

Official White House Photo by Pete Souza(RENO, Nev.) -- After two days with his same-sex marriage position in the spotlight, President Obama Friday sought to shift focus back to the economy, visiting a neighborhood hit hard by the housing crisis, to claim success at helping struggling homeowners and call on Congress to do more.

Standing in the driveway of a home whose owners had recently refinanced their underwater mortgage, Obama credited rule changes for government-backed loans that he imposed six months ago with allowing more Americans to benefit from historically low interest rates.

“Since I’ve made this announcement, refinancing applications have gone up by 50 percent nationwide and 230 percent here in Nevada alone.  That’s the good news,” Obama said. “People are taking advantage of this. That’s what we want to see.”

He also called on Congress to enact legislation that would allow more homeowners, not just those with government-backed loans, to refinance.

“I’m calling on Congress to give every responsible homeowner a chance to save an average of $3,000 a year by refinancing their mortgage,” Obama said. “It’s a simple idea, it makes great sense, and I know it will have an impact.”

Obama met with homeowners Val and Paul Keller before his remarks.  The couple had previously not been able to refinance their $168,000 mortgage, which they’d held for 14 years, despite keeping up with monthly payments.

Thanks to changes implemented by the administration six months ago, the Kellers were able to refinance last year, saving them $240 a month.

“The reason the Kellers were able to refinance is because the only thing that we could do without congressional action was to give opportunities for refinancing for folks with a government-backed loan, an FHA-backed loan,” he said. “But in order to expand that opportunity -- we want to include everybody, people whose mortgages aren’t government-backed -- we’ve got to have Congress move.”

But while Obama sought to claim credit for a surge in refinancing, it’s unclear how much of the influx in applications is directly attributable to his policy changes, which applied only to a select group of homeowners, versus average Americans just trying to take advantage of lower rates.

Moreover, as his critics note, it’s unclear whether the majority of those applications have been approved by lenders and therefore have resulted in savings for homeowners.

“How many people in Nevada fit the profile of the Kellers that actually got help and are a success story?” questioned U.S. Rep. Mark Amodei, R-Nev., who is a supporter of Mitt Romney.

“So to come in here and ask people to ignore that and say, I’m going to sit in the home of some folks that it’s actually helped, is like, Hey, congratulations for finding some of those folks,” he said on a conference call with reporters.

“But if you think the answer is a continued government refinancing deal to the ignorance of the economy and western Nevada, I quite simply disagree with your philosophy and I’m talking to the president here,” he said.

Neither the administration nor the Mortgage Bankers Association, which tracks the data, could say how many homeowners have been able to refinance under the new rules implemented in October. And experts conceded that more applications do not necessarily translate to lower rates.

In October, during a visit to Las Vegas, Obama announced a series of administrative changes spearheaded by the Federal Housing Finance Agency that have allowed select homeowners whose mortgages are backed by Fannie Mae and Freddie Mac, who have good credit and no late payments in the last six months to refinance without getting a new appraisal or full credit check.

The FHFA estimated at the time that the initiative could help thousands of homeowners.

The administration says the costs and “red tape” to refinancing remain prohibitively high, particularly for non-government-backed mortgages, and is now pushing legislation to expand the reforms to the broader housing market as part of its “to do list” for Congress.

Copyright 2012 ABC News Radio

Obama Heads to Nevada to Claim Progress on Housing

Creatas/Thinkstock(LOS ANGELES) -- President Obama on Friday will visit a Reno, Nev., neighborhood hit hard by the housing crisis to hail a success story in his efforts to turn things around.

Six months ago, from the porch of a Las Vegas home 400 miles away, Obama announced administrative changes to federally-backed mortgage programs to help some struggling homeowners refinance at historic low rates.

The administration now says the move has had a “significant impact on responsible homeowners looking to refinance,” citing a huge influx in refinancing applications and savings on monthly payments for those who are approved. 

In Nevada, where 60 percent of homes are underwater -- more than any other state in the country -- refinancing applications are up 236 percent since the changes Obama implemented in October, according to the Mortgage Bankers Association, which tracks the data. 

Nationwide, the number of applications by homeowners seeking to refinance their mortgages is up 50 percent over the period, the group says.

Obama will meet personally with two homeowners who have been part of the trend -- Val and Paul Keller of Reno -- whose underwater mortgage had previously not been eligible for refinancing, despite their keeping up with monthly payments on a $168,000 mortgage they’d held for 14 years. 

Thanks to changes implemented by the administration, the Kellers were able to refinance last year, saving them $240 a month.

“One of the most effective things that we can do to help more homeowners get back above water -- which can boost our economy and create jobs -- is to help them accelerate the pay-down of their mortgage through a new lower interest rate,” said Housing and Urban Development Secretary Shaun Donovan.  

It’s unclear, however, whether the influx in refinancing applications Obama plans to hail is directly attributable to actions by his administration.  Equally uncertain is whether the majority of those applications are even approved by the lender to result in savings for homeowners.

Neither the administration nor the Mortgage Bankers Association could say how many homeowners have been able to refinance under the new rules as the Kellers have.  And experts conceded that more applications do not necessarily translate to lower rates.

Copyright 2012 ABC News Radio

Obama to Announce Plans for Housing, Student Loan Reform

ABC News(WASHINGTON) -- President Obama is coining a new campaign slogan for a three day Western campaign fundraising tour, along with executive action that would not need Congressional approval on some mortgage and student loan relief.

“We Can’t Wait”  is the battle cry he takes first to Las Vegas, Nevada, where Monday afternoon the embattled President intends to stand on the front porch of a home and announce that his administration will ease the rules for homeowners who want to renegotiate their federally backed mortgages. In Las Vegas, home to Senate Majority Leader Harry Reid, one in every 39 homes is in foreclosure -- the worst rate in the nation.

The president’s action, which sidesteps Congress, would “knock down these barriers which will help responsible borrowers with little or no equity in their homes take advantage of today’s low mortgage rates,” according to an administration official.  “Those will include removing caps for deeply underwater borrowers and cutting costs of refinancing” for families with federally-backed mortgages.

In Colorado on Wednesday, President Obama will announce easier rules on repayment of college loans.

On a bus tour last week, President Obama began the drumbeat of criticism for Congressional inaction, telling crowds, “The election is 13 months away.  And folks can’t afford to wait that long” for action on job creation.

But Republicans are quick to point out that Democrats in Congress also opposed his jobs bill, and the president’s expensive stimulus plan has failed to work. In an email of news clippings critical of his record, the Republican National Committee dubbed this week’s trip the “West Coast Misery Tour.”

Copyright 2011 ABC News Radio