Waiver of refinancing fees to aid millions
WASHINGTON -- As many as 3 million homeowners could save about $1,000 a year because of a reduction in fees, announced on Tuesday by President Obama, on refinancing their government-backed mortgages.
In addition, the White House said it was taking new steps to help military members whose homes were improperly foreclosed by large mortgage servicers.
Among the steps, the servicers have agreed to conduct a review overseen by the Justice Department of all foreclosures of military members since 2006 to determine if they violated a federal ban on such actions for active duty service members. Any violations will result in the servicer paying the military member's lost equity, plus interest, plus $116,785.
The moves were the latest by the Obama administration to address the struggling housing market.
"While the government cannot fix the housing market on its own, the president believes that responsible homeowners should not have to sit and wait for the market to hit bottom to get relief when there are measures at hand that can make a meaningful difference," the White House said.
The broadest step is a reduction of refinancing fees by the FHA on mortgages it backs. By significantly cutting the fees to refinance loans made before June 1, 2009, the typical borrower could save about $1,000 a year because of lower mortgage payments. The FHA has had to raise fees in recent years to offset losses on bad mortgages.
The administration estimated 2 million to 3 million homeowners would be eligible for the reduced fees, which would be part of the FHA's existing program to streamline refinancings.
The moves for military members also include a review to see if they were charged more than 6 percent interest after making a valid request to lower the rate. Such a rate reduction is required under the Servicemember Civil Relief Act.
The review will be conducted by servicers, again under Justice Department oversight, of mortgages dating to 2008. Servicers would be required to compensate military members who were overcharged with a payment equal to four times the amount overcharged, plus interest.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.