According to unidentified members of the Obama administration, a proposal is being considered to allow homeowners with government-backed mortgages to refinance at today's roughly 4% rates.
There are a number of proposals in the air right now including but not limited to changes to previous refinancing programs to increase the number of homeowners taking part, as well as working on a home rental program that would exist to prevent mass foreclosed homes.
Refinancing could save close to $85 billion a year for homeowners; however, aside from the low interest rates, a large number of homeowners haven't been able to refinance their homes because they now owe more than the home is worth or their credit is poor.
These refinancing plans are merely up for discussion right now. The changes that could and most likely would happen are dramatic and could cause an uproar with it being so close to the 2012 election. With government-backed mortgages being at the lowest point since 2009 and the election coming up it is risky business messing with such a proposal as this.
The market won't see many economic increases before the 2012 election, and we can only hope to see a light at the end of the tunnel, after it. What could this proposal mean if it actually happens?
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