Thaindian News

Washington, Feb 2 (IANS) In the midst of a heating election campaign, President Barack Obama plans to help with good credit about 3.5 million Americans who are unable to refinance at historically low rates because their homes are worth less than their mortgages.

He argued that this key segment of struggling homeowners making monthly payments on underwater mortgages couldn’t afford to let the housing market bottom out, as many Republicans, including leading presidential candidate Mitt Romney, have advocated.

“This plan . will not help the neighbours down the street who bought a house they couldn’t afford, and then walked away and left a foreclosed home behind,” Obama said.

“It’s not designed for those who’ve acted irresponsibly, but it can help those who’ve acted responsibly.”

The proposal essential extends a plan announced last to help as many as 11 million underwater homeowners whose loans were backed or owned by Fannie Mae, Freddie Mac or the Federal Housing Administration, to the remaining underwater homeowners, whose loans are owned by banks or investors.

But the refinancing plan is strongly opposed by many congressional Republicans and faces an uphill climb in an election year.

In October, Romney told the Las Vegas Review-Journal that the housing market needed to “hit the bottom” before it could recover, and he has since talked about the need for foreclosures to run their course.

“It is wrong for anybody to suggest that the only option for struggling, responsible homeowners is to sit and wait for the housing market to hit bottom,” Obama told a crowd at Falls Church, a Washington area suburb, alluding to Romney’s comments. “I refuse to accept that, and so do the American people.”

(Arun Kumar can be contacted at arun.kumar@ians.in)