WASHINGTON President Obama said Wednesday that help for homeowners should be part of a broader housing finance reform bill.
In a Web chat with Zillow chief executive Spencer Rascoff, Obama said he will urge Congress to act on a reform package that would wind down Fannie Mae and Freddie Mac and place housing on a "more stable footing," but will also provide "some immediate relief to homeowners giving them a chance to refinance while interest rates are still low."
"This is something I am going to push again once Congress gets back in September," said Obama. "Let's see if we can potentially get this done before the end of the year."
Obama has previously called on Congress to broaden eligibility for a program known colloquially as Home Affordable Refinance Program 3.0 a term used by Rascoff in the interview that would allow homeowners to refinance their mortgages even if they are not guaranteed by Fannie and Freddie. The administration has said homeowners could save up to $3,000 refinancing their mortgages.
"This should be something that Democrats and Republicans can come together and get done," said Obama, a day after he gave a major speech on housing finance reform in Phoenix.
On Tuesday, the president offered broad principles for housing finance reform that were largely consistent with the administration's white paper released in 2011 and dovetailed with a bipartisan bill already introduced in the Senate. The paper suggested three possible ways to reform the system, including full privatization of the market and the elimination of any government support.
Obama said a future housing finance system should put private capital at the center of the housing market, but would still allow the government to have a "limited" role in the system.
He reiterated on Wednesday that the principles laid out in a bipartisan bill by Sens. Bob Corker, R-Tenn. and Mark Warner, D-Va. are "pretty consistent with me," and leave some room for the government to continue to ensure certain mortgage products are available to American families and maintain access to affordable homes.
"Our long term goal is to say, 'Let's have the private market get in there and provide those loans, and what the government can do is to step in to make sure, for example, there is still a 30-year mortgage available, to make sure there are homes that are not too upscale are available for young families, for veterans, for folks who may have some limited means, but have saved and scrapped, and are ready to go out there and buy," Obama said.
The president acknowledged any reform plan would take years to be phased-in, an approach, he said, that would be appropriate in order not to disrupt the housing market as it continues to recover.
"The one thing we want to prevent is at a time when the housing market is getting back on its feet to suddenly have a big shock to the system," said Obama. "This is something that will have to be phased in over a number of years, and I'm confident that it can be done."
Additionally, Obama said he expects the Consumer Financial Protection Bureau to finalize new, simpler mortgage disclosures as early as this fall to help consumers buying a home.
"The more knowledge consumers have the more empowered they are going to be and the more likely they live out the American dream that all of us want to see not just for ourselves, but for our kids and our grandkids," said Obama.