A bill designed to fuel faster, easier home mortgage refinancing is before Congress but Iowa Senator Chuck Grassley says the legislation’s future is uncertain. President Obama, in last week’s State of the Union address, called for quick passage of the measure, but Grassley, a Republican, isn’t convinced.
“I’m very pessimistic about anything that the government’s going to be able to do to help with the housing market,” Grassley says. “It just takes a long time to work your way out of the oversupply and I do think the housing market is bouncing back slowly but surely over the last year.”
The industry will eventually see prosperity, he says, through a reduction in the inventory, meaning, the selling of more houses. Still, Grassley isn’t jumping to back the plan which the president says would save the average homeowner three-thousand dollars a year through refinancing at a better interest rate.
Grassley says, “This is about the fifth effort since the housing market plunged or even since this administration has been in, to help people with housing and none of it seems to accomplish what they want to accomplish.” A lack of confidence in the economy is the primary problem, Grassley says, not the need to refinance our houses.
“We can help that confidence by getting the budget deficit down, getting regulations down, working for tax reform, international trade,” Grassley says. “Build confidence in the economy and the housing market will take care of itself.” Mortgage rates are approaching a 50-year low.
Supporters of the bill say some 12-million homeowners who have their mortgages with Fannie Mae and Freddie Mac stand to benefit significantly from refinancing.