May 12th, 2011
11:55 AM ET
Obama: Homeowners need more help
By CNNMoney Senior Writer Jennifer Liberto -
Calling housing "the biggest headwind on the economy right now," Obama broached two relatively new ideas for the White House: Longer-term mortgage modifications and principal reductions "in some cases."
Both ideas would require Congress to pass laws to force the banks to cooperate.
"If we were there for you [banks] when you got into trouble, then you've got to be there for the American people when they're having a tough time," Obama said during the CBS program which was taped on Wednesday.
In response to a question posed by Nancy Logan of Virginia, an underwater homeowner whose three-year mortgage modification will expire in January 2012, Obama said that reducing some mortgage principals would benefit the banks as well as homeowners.
Obama's mention of principal reduction, in particular, is sure to stir Wall Street banks. When Obama campaigned, he had talked about pushing for policy to give bankruptcy judges the ability to write down principal owed on homes whose owners are bankrupt.
But when he took office, the president stood on the sidelines of legislation that would have allowed principal reductions, and his administration said that current housing policy was good enough.
Since then, the president rarely, if ever, publicly discussed principal reductions.
Big banking groups have traditionally lobbied hard against any new policy that would open the door for more principal write downs.
At least one banking group said they weren't opposed to a policy that would open the door for mortgage modifications that spanned longer periods, but they can't support legislation that invites more principal write downs.
"Banks are committed to helping Americans struggling with their mortgage," said Scott Talbott, senior lobbyist with the Financial Services Roundtable, a bank lobbying group. "Banks have already worked directly with over 4 million Americans to make long-term mortgage modifications."
During the town hall, Obama also defended his administration's housing programs, which one independent inspector general had criticized as a failure. House Republicans passed a bill to kill the administration programs that give banks incentives to modify mortgages.
"The problem is .. that the need is so great. So it's like you have a huge pothole, and you only have so much gravel," Obama said. "If you're talking about $5 trillion worth of home value, and a program that only has a few billion dollars, then there are a lot of people who are not going to be helped."
That's right Pres Obama, after all that taxpaying AMERICANS have done to save or bail out 'wall street' banks, when we need them, and they have helped many; why would the House Republicans even think to conjure up an idea to pass a bill to kill the OBAMA administration's programs initiatives to banks, who're trying to work with American taxpaying voters, on rewriting or modifying their home loan mortgages? Do they really care about 'MAIN STREET'? Is it that they hate OBAMA so bad, anything to undermine him?
It's like I've said for 2 years; the hate for this PRESIDENT and any of his genuine efforts to overhaul AMERICA, especially the people has been met, and I sincerely believe will continue to be met with resistance, no matter who it hurts, simply because they do not like 'his kind' looking like; Oooooh! A 'hero'? Oh No! an intelligent black man? OMG! One who IS diplomatically savvy, one who JUST may be doing the right/best thing for AMERICA in the long run. GOP: 'Oh boy, we've gotta stop this by all means'!
SO DISGUSTED, DEPRESSED AND DISAPPOINTED WITH BOTH THE BANK (WELLS FARGO) AND THE GOVERNMENT–REQUESTED A LOAN MOD IN 2008 AND AM STILL FAXING & COMPLYING WITH REQUESTS, EVEN THOUGH THE BANK HAS NEVER, NEVER OFFERED EVEN A REDUCTION IN INTEREST RATE WHEN RATES DROPPED DRAMATICALLY. WE HAVE NOW BEEN SERVED WITH FORECLOSURE DOCS–EVEN THOUGH WELLS FARGO SAYS THEY ARE STILL REVIEWING (FOR 3 YEARS NOW) OUR FILE FOR A SOLUTION. IT IS A JOKE; ESPECIALLY SINCE 2008 WHEN I WAS LAID OFF FROM MY JOB AND NOW MY HUSBAND WAS LAID OFF FROM HIS JOB AND WE ARE TRYING TO SEND 2 CHILDREN TO COLLEGE. WELLS FARGO TOLD ME THE OTHER DAY THAT THE INVESTOR (FANNIE MAE) HAS NOT GIVEN THEM THE CONTRACTUAL AUTHORITY TO MODIFY OUR LOAN UNDER THE HOME AFFORDABLE MODIFICATION PROGRAM–JUST TELLING US THIS AFTER 3 YEARS??? DO ANY OF THE BANKS CARE ABOUT WORKING WITH PEOPLE AND FAMILIES OR JUST ABOUT THEIR BONUSES?? IS THERE ANYONE OUT THERE WHO CARES THAT AMERICANS ARE SUFFERING AND JUST GETTING THE RUNAROUND OVER AND OVER AND OVER DESPITE THAT PERSON'S BEST EFFORTS AND WILLINGNESS TO WORK WITH THE BANKS AND INVESTORS?
I have been told that my father will not get his modification due to his age. They have used stalling tactics (a term told to me by a servicer agent), to prolong the application(repeated request for paper work that has been sent in numerious times) to where he now does not meet the ridiculous 31% ratio to qualify. Had they not stalled him or told him he had to be more than 60 days behind he would have qualified in 09. I was told he qualified according to his application by HUD couselor in 09. Never Happened. There are class action law suits against this servicer for unfair practices. Grade of F with BBB with an alert on this company. My Dad did not pick this servicer. Where can we go for help?? Iam sure my Dad is not alone. How many other elderly people are being treated this way and have no one to help them? Served his country in Air Force. To be treated this way. Why are these companies being paid from government for foreclosures and being paid less money for modifications. Read the Freddie Mac Bulletins. Where is the insintive to work out modifications? President Obama PLEASE Where is the Common Sence?