With the GOP primaries moving to Florida, the issue of “government’s role in housing” has become a focal point for Mitt Romney and Rick Santorum. Governor Romney has inferred Newt Gingrich was tied to the housing crisis through his work with Freddie Mac.
Governor Romney is also pushing to remove government intervention to keep homeowners in their homes. The solution Governor Romney’s proposes is to have the housing market naturally bottom out, which Governor Romney feels will sustain long-term growth.
The GOP candidate's comments are specifically directed at programs implemented by the Obama administration, which include the Making Home Affordable Program.
The Making Home Affordable Program was made part of the Financial Stability Act of 2009.
Since its inception, the program has come under constant fire with many opponents pointing to the low rate of permanent modifications.
Opponents also argue homeowners do not have the ability to modify their mortgages to an affordable payment amount.
Proponents of Making Home Affordable argue the banks fail to follow the required guidelines and in some cases, the banks setup homeowners for failure once they are provided a temporary modification.
The statistics make it difficult to find the culprit for the rates of permanent modifications. Whether the program should be modified or overhauled, both sides seem to agree the Making Home Affordable Program’s current structure does not work.
Simply allowing the housing market to naturally bottom-out could leave millions of homeowners with no place to live. Governor Romney’s strategy believes homes would be resold at market values to investors and investors would then place renters in the homes.
Getting to this point may leave significant fallout and would likely disenfranchise homeowners who continue to struggle with their mortgage or rent. With the Obama administration's housing assistance programs floundering, the GOP candidates have an easy target.
The solutions, however, do not seem as easy. Contact Us for Foreclosure Assistance.