Now that President Barack Obama’s $787 Billion Economic Stimulus Bill has been signed into law and will take effect on March 4, many American homeowners are anxiously wondering how this bill may affect the housing market and possible mortgage relief. Despite primarily focusing on bolstering the economy by creating jobs and reviving spending, the bill includes steps to revitalize this critically important segment of the American economy. But what impact will the stimulus package directly have on your mortgage?
President Obama’s financial resue plan, named the American Recovery and Reinvestment Act, is designed to address two groups of homeowners: those who are current on payments but have high mortgage rates and not enough equity to qualify for a mortgage refinance loan, and those who are at risk of losing their homes to foreclosure.
Watch Obama’s Radio Address 01-31-09
The mortgage rescue plan also intends to provide $200 billion in additional financial backing to Fannie Mae and Freddie Mac to increase money available for home lending. These steps will directly help homeowners and new home buyers seeking a new mortgage, says Michael Isaacs, president and CEO of Residential Finance Corporation a national mortgage lender specializing in FHA refinances. “The stimulus package aims to make money more readily available for lenders to help those who are currently in need,” says Isaacs. “The American Recovery and Reinvestment Act will directly help those seeking to refinance out of bad mortgages as well as those looking to become homeowners for the first time.”
