[NOTE: As you read this article, you may wonder as we do, “Doesn’t this look like a scheme in which those who have money will be abetted by government intervention and will make more money? Take a serious read of this, especially the part at the end in which “investors” will be able to buy properties and convert them into rental pr0perties. Huh?]

by Cora Currier, ProPublica

“The Obama administration recently unveiled a string of proposals to help struggling homeowners and get the housing market back on its feet — part of the administration’s “We Can’t Wait” election year to-do list. Of course, the White House has made big promises before about helping homeowners, only to see them disappoint time and again.

President Obama announces a plan to help homeowners with federally guaranteed mortgages refinance their homes during an October 2011 speech in Las Vegas. (Photo by Ethan Miller/Getty Images)

Here are the latest proposals, whether they are anything new and whether they stand a chance of going anywhere.

Refinancing

“President Obama wants to allow homeowners whose mortgages are backed by private-sector companies to refinance at lower rates through the Federal Housing Administration. (The FHA insures many mortgages, and it is not the same as the FHFA, the regulatory agency in charge of Fannie Mae and Freddie Mac.) The president stressed that the proposal would help only ‘responsible’ homeowners who were current on their payments — to counter Republican complaints that his housing policies reward foolhardy borrowers.

“Déjà vu: This is only the latest in a long series of attempts by Obama to help homeowners refinance. There have been a few, minor attempts to push refinancing through the FHA. Via a separate program launched in 2009 that used Freddie and Fannie, more than 900,000 homeowners have refinanced, substantially fewer than the goal of 4 million homeowners.

“Will it happen? Unlikely. This plan needs to get through a Congress that is staunchly opposed. ‘How many times have we done this?’ said House Speaker John Boehner, R-Ohio.

“Republicans have a number of objections. First, Obama wants the plan to be paid for with a fee on the banks in repayment for the bailout, a tactic that’s raised Wall Street hackles in previous budgets. Secondly, some Republicans balk at passing more risk on to the FHA, which is in danger of having to ask the Treasury for a subsidy for the first time in its nearly 70-year history. Even if the plan passes, its impact would likely be limited. For the Obama administration to instigate mass refinancing without Congress’ help, many say it would need to get Fannie and Freddie on board, a move the companies’ regulator has so far been reluctant to endorse.”

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