President Barack Obama formally unleashed his proposed overhaul of the country’s mortgage system on Wednesday that according to him will offer fresh starts for many Americans and provide them a tool to keep their homes from being foreclosed.
The new legislation, Obama said, will offer assistance to responsible homeowners at record low rates and provide for additional saving that could reach $3000 each year.
The President called his proposal, earlier mentioned at his State of the Union speech last week, as the ‘Homeowners Bill of Rights’ that will simplify the currently complicated process of securing a home loan.
“It’s one straightforward set of commonsense rules of the road that every family knows they can count on when they”re shopping for a mortgage,” Obama said.
If passed by the U.S. Congress, Obama’s proposal will offer simple guidelines and over-the-board fees for borrowers, erasing the likelihood of foreclosures that more often hit those who were already financially struggling.
“If you”re ineligible for refinancing just because you”re underwater on your mortgage, through no fault of your own, this plan changes that. You”ll be able to refinance at a lower rate, you”ll be able to save hundreds of dollars a month you can put back in your pocket,” Obama said.
The President also announced the formal creation of online casino the Consumer Finance Protection Bureau (CFPB), the federal agency that will oversee the implementation of the new mortgage system.
CFPB will be headed by Richard Cordray, Obama said, who introduced last week. His main task is to ensure that consumers will not be cheated by effectively rolling out the new system, in which “terms are clear and fees are transparent.”
“This is a make-or-break moment for the middle class, and this housing crisis struck right at the heart of what it means to be middle-class in America,” Obama stressed.
The White House proposal is likely to encounter opposition from the House of Representative, with House Speaker John Boehner labeling the legislation as nothing but a rehash of previously failed measures.
“None of these programs have worked … and I don”t know why anyone would think that this next idea is going to work,” Boehner said.
Also, leading Republican presidential contender Mitt Romney has suggested that Obama will fail on his re-election bid November this year because “if you are part of the housing crisis, you are probably not going to get elected president.”
Boehner added that not a few times that the government extended its assistance to troubled homeowners and all those times, the initiatives proved disastrous.