Washington — Declaring “good news” in the midst of an economic meltdown, President Barack Obama on Thursday urged families to take advantage of near-record low mortgage rates by refinancing their home loans.
“We are at a time where people can really take advantage of this,” Obama said, seated with a handful of homeowners who have already lowered their bills.
But he also warned people to watch out for scam artists, cautioning, “If somebody is asking you for money up front before they help you with your refinancing, it’s probably a scam.”
Rates on 30-year mortgages inched upward this week but remain near the lowest level in decades, allowing borrowers with strong credit and stable jobs to save money if they refinance.
The average rate on a 30-year fixed-rate mortgage rose to 4.87 percent this week, up from 4.78 percent last week, Freddie Mac reported Thursday. That was the lowest in the history of the survey, which dates back to 1971.
Low rates have sparked a surge in refinancing activity, with nearly 80 percent of new home loan applications coming from borrowers seeking to refinance. Freddie Mac’s sibling company, Fannie Mae, refinanced $77 billion in loans last month, nearly double February’s volume.
“The main message we want to send today is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates,” Obama said. “That is money in their pocket.”
Foreclosures and defaults continue to break records. A record 5.4 million American homeowners with a mortgage, or nearly 12 percent, were at least one month late or in foreclosure at the end of last year. And nearly half of homeowners with a risky subprime adjustable-rate mortgage were in trouble.
Last month, the Obama administration launched a new plan to provide $75 billion in incentives for the mortgage industry to modify loans to help borrowers avoid foreclosure. On Thursday, the president encouraged people to take advantage of a government Web site — www.makinghomeaffordable.gov — to see how they can get help.
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Centerville (anonymous) says…
I heard part of the press conference and have never heard anything so patronizing. I suspect that TOTUS was told to show a speech for 6-year-olds. But TOTUS did offer that superb fall-back line "Come on, you guys, this is about housing!!!" if any pesky questions about a certain American hostage came up.
Satirical (anonymous) says…
Dear Mr. President,
I am thinking about painting my house, which color does the anointed one think I should choose? Also, I am still waiting for a response to my letter asking which toilet paper the Obama administration has approved. Please expedite your divinely inspired choice, because I really have to go.
imastinker (anonymous) says…
I'd like to refinance to get a lower rate. With current rates I can keep my payment and turn 27 years of payments into a 15 year loan. Unfortunately, I have been making my payments (extras even) and they will not refinance unless I show up with 20% equity or collateral.
If the president is going to give handouts (refinancing to people who can't make payments), he could at least give it to people who are responsible too! I bet a lot of people who are getting assistance have lots of "things" that I don't have - like new cars, television, vacations, etc...
Satirical (anonymous) says…
"All aboard the titanic"
But sir, shouldn't we avoid that piece of ice in the water?