BOISE -- President Obama released a plan Monday to help keep Americans, who are upside down in their mortgages, in their homes. This new housing program is for those who pay their mortgages every month, but still owe more than their home is worth.
The plan is to help them refinance at a lower rate, something that wasn't easily done in the past.
“This is really the first time that they've come out with something that's targeted for borrowers,” said Gerald M. Hunter, the President of the Idaho Housing and Finance Association
Although all the details of Obama's new housing plan haven't been released, Hunter says it has potential to help a lot of homeowners in Idaho who are upside down in their home mortgages.
“There's quite a few that are in that situation,” said Hunter.
There is criteria that has to be met to qualify for the new refinancing option. It's for homeowners who pay their mortgage every month, but still owe more than their home is worth, they also have to hold their mortgage through Freddie Mac or Fannie Mae.
The goal is to save homeowners money.
“Their home loan will drop by a couple of hundred bucks for example,” said Hunter.
“We would certainly hope that it would extend out to a lot more people,” said Shanna Wroten-Tucker, the Branch Manger of Benchmark Mortgage in Boise.
She is expecting a lot of business when the new program officially takes effect this winter.
“In theory it could help out thousands of treasure valley residents,” said Wroten-Tucker.
Wroten-Tucker says last year, because of strict federal guidelines her company was only able to help one in 30 people get out from underneath their upside down mortgage. With the announcement of this new program with less stringent guidelines, Wroten-Tucker says they're hoping to save a lot of people a lot of money.
“This program will hopefully help people take advantage when they have been responsible,” said Wroten-Tucker.
Nationally, some economists believe this program could help between 800,000 to a million Americans get out from underneath their home mortgage.