During his State of the Union address six weeks ago, President Obama focused more on the housing crisis than he did in his previous two SOTUs combined (albeit three years too late). Yesterday, in his first press conference of 2012, he returned to the topic.
The President discussed providing housing relief for members of the military and veterans and refinance assistance for responsible homeowners (I get nervous whenever I hear the administration use the term "responsible," since it puts the definition of what constitutes responsible in the President's hand - in other words, responsible becomes what he says it is.).
According to the administration, the FHA will cut its fees for refinancing loans already insured by the FHA. It estimates that two to three million borrowers could be eligible for this savings, providing the typical FHA borrower with the opportunity to save about a thousand dollars a year through refinancing than they could have under today’s fee structure.
The other announcement is a very good one, particularly here in San Diego and in North County where we have so many military personnel (and thanks to each and every one of them for their service). On top of the historic settlement completed by the Federal government and 49 state Attorneys General last month (that means in addition to), major servicers will be providing significant relief to thousands of servicemembers and veterans. Under the agreement, they will:
- Conduct a review of every servicemember foreclosed upon since 2006 and provide any who were wrongly foreclosed upon with compensation equal to a minimum of lost equity, plus interest and $116,785;
- Refund to servicemembers money lost because they were wrongfully denied the opportunity to reduce their mortgage payments through lower interest rates;
- Provide relief for servicemembers who are forced to sell their homes for less than the amount they owe on their mortgage due to a permanent change in station;
- Pay $10 million dollars into the Veterans Affairs fund that guarantees loans on favorable terms for veterans; and
- Extend certain foreclosure protections afforded under the Servicemember Civil Relief Act to servicemembers serving in harm’s way.
I've been very critical of President Obama, but these are good moves by the administration.