WASHINGTON -- The Obama administration is introducing a new program on Monday designed to lower monthly mortgage payments for more troubled homeowners.

But a key new condition in the plan would shift the financial liability for refinanced loans from Wall Street banks to the American taxpayer. And by focusing on lower payments, the program does not confront what housing experts view as the core problem in the foreclosure crisis -- borrower debt that exceeds the value of one's home.

The newly expanded program would expunge legal liabilities associated with mortgages refinanced through the program for the original lenders of the mortgages. Each time a bank sent a loan to Fannie and Freddie, it certified that the loan met Fannie and Freddie's safe lending criteria. But many loans sent to the mortgage giants did not, in fact, meet those criteria. Currently, when borrowers default on those ineligible loans, the mortgage giants can "put back" the resulting losses onto the banks that pushed the loans.

Under the modified plan, "put back" liability at banks will be erased for any underwater mortgage that is refinanced through HARP, eliminating Fannie and Freddie's ability to sack lenders with losses in the event that the mortgage does not pan out.

According to an administration official, Mr. Obama will kick off his new offensive in Las Vegas, ground zero of the housing bust, by promoting new rules for federally guaranteed mortgages so that more homeowners, those with little or no equity in their homes, can refinance and avert foreclosure.

Originally posted by Master_007
Get someone in office that knows if he takes one cent in bribes and he will be charged with treason and executed and things will start to get better !

You know just enforce the laws we have already.

The fathers tried to warn us about this day after being screwed by british bankers but it looks like we are going to have to re-learn the history lesson.

I have no trouble with people earning more than others but this has gone past a joke when Obama acts as if he care more about the people in Syria than the 500,000 people in the USA who are dieing from Cancer because they are getting 3rd world treatment for cancer and people in Libya were getting better treatment before we bombed the place and sent Haliburton and the banksters in to rebuild what we have bombed.

edit on 24-10-2011 by Master_007 because: (no reason given)

NEW YORK (CNNMoney) -- It might get easier for some homeowners to refinance their mortgages, but that won't do much to help the broader housing market.

The Obama administration Monday announced changes to its refinancing program to allow more homeowners who are current on their loans to take advantage of today's super-low mortgage rates.

The program is being touted as a way to help stabilize the housing market and stimulate the economy. But without addressing distressed homeowners and helping to clear the foreclosure glut, the effects will likely be limited, experts said.

"I would call it much to do about nothing," said John Burns, head of John Burns Real Estate Consulting. "It will help in such a small way, it's almost meaningless."

Designed to allow those who are current with their payments but have little or no equity in their home to secure lower mortgage rates, the president's Home Affordable Refinance Program has helped only 894,000 borrowers since the spring of 2009. The administration had originally hoped that up to 5 million homeowners would benefit.

To spur take up, the administration is now allowing more people to participate, as opposed to limiting it to borrowers whose loans are no more than 25% larger than their homes' value. It is also eliminating various fees and appraisal requirements, as well as extending the program for another 18 months.

And perhaps, most significantly, it will ease banks' liability to repurchase the loans if the borrower defaults. This should increase competition among banks to refinance more homeowners in good standing, administration officials said.