President Hosts Refinance Roundtable

President Barack Obama held a roundtable discussion in the Roosevelt Room of the White House on Thursday with a group of homeowners who have recently refinanced their home mortgages, taking advantage of historically low interest rates.
At a photo opp before the roundtable, Obama said, ""The main message we want to send today is there are 7 to 9 million people across the country who right now could be taking advantage of lower mortgage rates. That is money in their pocket.""
A central component of the administration's blueprint to get the economy back on track is the ""Making Home Affordable"":http://www.makinghomeaffordable.gov program. According to the president, falling home prices and disruptions in credit markets have limited many borrowers’ ability to refinance, through no fault of their own. The administration says the ""refinance portion"":http://www.makinghomeaffordable.gov/refinance_eligibility.html of the two-pronged Making Home Affordable program targets those borrowers directly, by giving homeowners with mortgages through Fannie Mae or Freddie Mac the opportunity to refinance even if their home has lost value. A typical homeowner can now refinance and save around $2,000 a year, White House officials said.
Since the administration’s housing plan was announced in mid-February, rates on 30-year mortgages dropped to an all-time low of 4.78 percent (though followed by a slight uptick to ""4.87 percent this week"":http://www.freddiemac.com/pmms/release.html), and refinancing applications are up 88 percent, according to the ""Mortgage Bankers Association's"":http://www.mortgagebankers.org/NewsandMedia/PressCenter/68454.htm weekly survey. Fannie Mae refinanced $77 billion of mortgages in March, nearly twice the February amount, and the company's highest monthly volume since 2003. In addition, White House officials said, over 500,000 borrowers have accessed Fannie Mae's Web site to learn about refinancing options.
Joining the president, Treasury Secretary Timothy Geithner, and Housing Secretary Shaun Donovan at the refinance roundtable were homeowners from five households in the Washington, D.C. and Virginia areas.
Pedro and Luz Cruz from Woodbridge, Virginia, have lived in their home for over eight years, but were faced with losing their home when Mr. Cruz's work hours were reduced. The Cruzes were able to refinance from a 15-year mortgage to a 20-year conventional mortgage, saving them approximately $700 per month, enough to safely allow them to meet their entire mortgage and other debt obligations and maintain their family home.
Gail Johnson lives in southeast Washington, DC and works as a night shift R.N. at the Washington Hospital Center. When she originally purchased her home, Johnson was put into an adjustable rate mortgage (ARM) loan that was not well explained or well understood. Johnson went to her mortgage broker to refinance and get out of the high-cost ARM that was getting ready to increase her payment drastically. She refinanced to a fixed rate with very low closing costs, lowering her mortgage payment by $400 per month.
Julie and Mary Pavlik are sisters living together in a home they own in Vienna, Virginia, for the last 11 years. They recently refinanced from a 30-year mortgage to a 15-year mortgage and combined a second mortgage they had taken out to help cover household expenses.
Tran Nguyen, an immigrant from Ho Chi Minh City, Vietnam, has lived in his home in Fairfax, Virginia since 1997. Nguyen's mother, who is a realtor, also lives in the home. Nguyen said that refinancing his mortgage has made a big difference to his monthly cash flow - it’s not only helped with food and utility bills, but helps him provide the necessary support for his mother.
Jeffrey and Shelby Haggray have resided in Washington, D.C. since they were married 1992. The Haggrays decided in November 2008 that refinancing their home was the best option available to them in light of their financial picture. Their monthly household costs exceeded their combined monthly income by several hundred dollars, and they were struggling with property taxes, utilities, and living expenses for their family of five. Their new loan was issued in January 2009, allowing them to consolidate their first and second mortgages, and pay off other outstanding debt. As a result, they’ve experienced a reduction in their monthly household expenses of about $1,200.
Regarding the president's own mortgage situation, _""The Chicago Tribune"":http://www.chicagotribune.com/news/politics/obama/chi-obama-mortgageapr10,0,7059943.story_ reported on Friday that the Obama family shouldn't try to refinance their own home in Chicago's Kenwood neighborhood. Local mortgage broker, Jim Brady of PrivateBank Mortgage Co., told the _Tribune _that President Obama should sit on the 5.62 percent super-jumbo mortgage he took out to purchase the restored Georgian mansion, as the rates on these larger loans are not much lower now. According to the paper, the average super-jumbo rate at the time the president purchased the $1.65 million home for $1.32 million ranged between 5.93 and 6.0 percent.