White House hears calls for action

I’m sending this Congress a plan that gives every responsible homeowner the chance to save about $3,000 a year on their mortgage, by refinancing at historically low interest rates. No more red tape. No more runaround from the banks. A small fee on the largest financial institutions will ensure that it won’t add to the deficit, and will give banks that were rescued by taxpayers a chance to repay a deficit of trust.—President Barack Obama, State of the Union 2012

A lot of people, including me in my blog on Monday, have been calling for the President and Congress to take strong action to stop the housing foreclosure crisis not only to keep hard working American’s in their homes but also to revive the housing construction industry.  Last night President Obama indicated that he has heard our message and will challenge Congress to force financial institutions to allow “responsible” homeowners to refinance at today’s rock bottom interest rates with “no questions asked”.

 That’s great news.  But now we need to see the details of the plan.  How are “responsible” homeowners defined?  We need to include as many homeowners as we can, not just ones current in their mortgages.  And we also should include investment properties not just owner-occupied housing.  It hurts the economy and property values just as much went a rental unit occupied by a working American is kicked out of the house they rent due to foreclosure. 

The bigger issue is how do we stop the big banks from killing the idea in Congress?

On Monday I said, “It is time for these private banks to give back to the country for bailing them out.  The profits they’re reeling in now wouldn’t exist if it wasn’t for the taxpayer.”  Last night the President said the program “will give banks that were rescued by taxpayers a chance to repay a deficit of trust.”

 But I doubt that our calls for the big financial institutions to grow a conscience will be effective.  That's why we must all push hard against the upcoming lobbying effort to stop this plan.  Tell your member of Congress to support the President on this issue.