Last week, during his State of the Union address, President Obama laid out a Blueprint for an America Built to Last, calling for action to help responsible borrowers and support a housing market recovery. This morning, President Obama announced a plan that will give every responsible homeowner in America the chance to save about $3,000 a year on their mortgage by refinancing at historically low rates.
President Obama also proposed a Homeowner Bill of Rights – a set of “commonsense rules of the road” to protect buyers and homeowners alike.
This Homeowner Bill of Rights follows three core principles:
- Simple, Easy to Understand Mortgage Forms: Every home buyer should have access to clear, straightforward forms that help inform rather than confuse them when making what is for families their most consequential financial purchase. To help fulfill this objective the Consumer Financial Protection Bureau (CFPB) is in the process of developing a simple mortgage disclosure form to be used in all home loans, replacing overlapping and complex forms that include hidden clauses and opaque terms that families cannot understand.
- No Hidden Fees and Penalties: Servicers must disclose to homeowners all known fees and penalties in a timely manner and in understandable language, with any changes disclosed before they go into effect.
- No Conflicts of Interest: Services and investors must implement standards that minimize conflicts of interest and facilitate coordination and communication, including those between multiple investors and junior lien holders, such that loss mitigation efforts are not hindered for borrowers.
Read more about President Obama’s plan to help responsible homeowners at WhiteHouse.gov.