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Anonymous
Jan. 20, 2012
Interest rates are at historic lows. If you could refinance your home you'd have thousands of dollars of disposable income to spend on education, feathering your nest, a new car, vacations, or paying down debt. But your home doesn’t appraise high enough to qualify. Doesn't seem fair, since you'd make your mortgage payment on time every month, either way.
The Homeowners' Jubilee Act would forgive the regulations on “value” of performing loans for refinancing them for a period of three years. Homeowners that are behind on their payments would have to become current, stay current for six months, and meet all other mortgage qualifications for refinancing.
All this increased disposable income would kick start the economy, create jobs, and therefore demand for existing homes. Home prices would rise which would strengthen banks' balance sheets.
Critics might say that gaming the down payment and interest rates is what got us into this economic mess in the first place. However, that ship has already sailed. Refinancing a performing mortgage loan has no effect on the bank's risk, in fact, they would get immediate income from the fees that would strengthen their balance sheets.
You can rate this and other ideas for a greater U.S. at http://www.agreater.us/billpage.php?id=70
Jon Denn
Editor
aGREATER.US