Editorial Round-Up: Obama's Mortgage Refinancing Solution
A round-up of the nation's newspapers' response to Obama's mortgage refinancing plan.
Will President Barack Obama's proposal to expand the scope of federal mortgage aid turn the economy in the right direction? Editorial pages across the nation's newspapers seemed uncertain.
USA Today commends the president's plan as a "worthy step" in a bigger effort to jumpstart the housing market. There is also legislation working its way through Congress that would ease the refinancing process, the editorial says, Millions could benefit from a looser financial model. But, the newspaper warns, the country must be careful to keep its expectations for these refinancing proposals in check.
"It is a practical middle ground between a massive home-buyer bailout and doing nothing," USA Today writes. "While it wouldn't solve all the nation's housing problems, it would be a help while the housing market continues through the long process of righting itself."
"The 597 people who have lost property through foreclosure in Rowan County in 2011 might wish President Obama had acted sooner on the mortgage relief plan he announced Monday," laments the Salisbury Post in North Carolina. "But the program would have helped few of them. As relief efforts go, this one is conservative."
The Post says the refinancing program's standards -- which require applicants to be employed, paying a high interest rate and having not missed a payment in six months -- are too tough for homeowners in the most need of help. "Might as well require them to be left-handed, green-eyed and over 6 feet tall," the editorial board writes.
The Oregonian characterized its housing landscape as a "disaster." But it praised Obama's latest plan, particularly pleased that it should prove profitable for banks as well: "an incentive that by itself might ensure success." The editorial also backs a proposal by one of its U.S. Senators to create a matching down-payment program that would allow all Americans buy a home, saying this is the "perfect moment" for such an ambitious plan.
In California, the San Jose Mercury News has a more tepid response: "It will probably help a little," its editorial says. But Obama's plan ignores what would be the "surest way" to end the foreclosure crisis: reducing the principal balance owed for at least some of the homeowners in need.
The Mercury News also urges states to become active in solving the problem. It cites counterproductive measures taken by the California Housing Agency's campaign to repossess homes as the wrong kind of approach. Find a way to keep people in their homes, the newspaper says.
The Philadelphia Daily News lambasts Republican lawmakers who took Obama's announcement as an opportunity to make cheap political jabs with plays on his "We Can't Wait" slogan. "It's just hilarious, apparently, that 14.6 million of the nation's mortgages (29 percent) are underwater," the editorial board says, concluding that the refinancing plans were important "small steps" in the right direction.
The city's other major newspaper, though, seems less enamored with the president's proposal. "America's homeowners still wonder why they weren't considered too big to fail when the recession was ravaging the economy," the Philadelphia Inquirer writes. This latest plan is too weak, the editorial board says. It also endorsed the strategy outlined by the Mercury News: reduce the principal for those homeowners in a position to pay back most of their loans. That way, people will have more money to spend elsewhere, which should boost the economy, the Inquirer asserts.