President pushing new plan to help struggling homeowners
White House Economic Adviser Gene Sperling weighs in
- Duration 5:14
- Date Feb 1, 2012
White House Economic Adviser Gene Sperling weighs in
Also in this playlist...
This transcript is automatically generated
-- poverty or turned -- -- -- he's the director of the White House national economic council on.
June 1 -- you think that this plan the president proposes.
Is the way to go I guess I'm having trouble understanding.
On how imposing fees -- could go into the billions for bank.
It's helped us.
-- -- Well let's understand what the heart of the president's proposal as.
The heart and it's very simple it's insane that we should allow all responsible borrowers the chance to have streamlined.
We have historic.
Low mortgage interest rates and we have a lot of people who.
Made their payments they been responsible but they're falling through the cracks because they.
Didn't get it GSE backed loan or oddly enough that sometimes because they're too much equity in their home which makes no sense.
Or there being there or and and we're not allowing the kind of competition we need.
Among the -- so they're competing with homeowners to see who can give them the best deal the best refinancing.
That's the heart of this package and it really should be.
Quite a controversial this time this would be putting more money in the pockets of responsible homeowners that's good for the economy it's good for the house.
-- market may be Gina and and you know.
It may be available your heart's in the right place but we'd been there done that tried that again and again and again -- it today at best mixed results right.
All these housing picture let all these Morgan retail prices on the cards what what does it predicts.
Can I count on that this is really quite basic I mean every American understands the basic notion that if you took out mortgage at 7%.
And now you've -- mortgages are at 4% or four and a quarter.
Americans would like to refinance this is -- about a big complicated program it's about taking -- barriers for typical American families.
Who would like to refinance and they hear.
That the government is taking away barriers that are leading banks to shutting the door.
Up on them when they're trying to refinance.
And they're taking away those barriers and making sure everyone is knowledge none out.
-- -- -- -- -- The service -- but Democrats and Republicans should be -- forgetting that we're back on -- I agree about refinances the way and I if it sounds good on Paper.
-- you know so many of these mortgages are sold in that resold.
And repackaged and sold again so the original -- is long gone so the new investor comes in and says wait a minute why MRI.
Stuck with that is that is the refinancing costs of this -- Well -- you know look I think what we've tried to do is is offer.
You know it guarantees so that there is it's there's an incentive for the.
For the lender not only two off of the refinancing but also to create the competition.
That you that that we want.
So then winners against senator -- paying guarantees.
He might have well -- complained.
No I -- you were I don't I disagree throughout -- more in fees for small let's just be clear about something.
If you're talking about the fact that this program cost five to ten billion dollars and that the president to protect the taxpayers asked.
The very very largest bank Spain's finance institutions over fifty billion who are taking.
According to the degree of risks are taking just pay a smaller -- I don't believe nobody believes that those large financial institutions have no choice in how to deal that other then but I don't know how banks aren't friends -- Try to recoup that capital there is one day look even more stints at landing in the future.
Or charge you other fees and others if you're sending -- banks about what you -- -- -- gazans aren't they just gonna find another way to -- their customers.
But -- what we're doing is exactly what you should support is we're trying to -- the competition so that every bank.
Understands that they can offer.
Two out to a homeowner.
Who's in the money where it makes sense for them to do that when you create that kind of competition -- -- -- what -- your adrenaline to their parent of a president what doesn't work right now.
How is without that competition.
If I'm a bank and your.
I have a -- you have a 7% mortgage and you're making payments to me I don't have any incentive.
To give you a new deal it for four and a half percent.
I have that incentive if I think and I don't see any good candidate for you Larry -- -- -- that's it sank -- bad.
-- -- you know Arnold and I can't -- history.
-- to tell them this time it will succeed.
Well first -- I disagree with your assessment I think that -- -- things the president has done.
Has helped lead to five million families having them their mortgage modified.
That's we've seen foreclosures go down more than -- -- and a half barrel again.
-- -- -- I don't agree that statistic but but -- even if we wanted to come have a history debate -- you know that we're talking about here is a very simple thing.
It is refinancing is something and let's beyond ever since somebody got a lot -- conservative hold it but -- you know a lot of my peers on the Republican side.
You know -- covered others -- listen to this type of thing.
Johnny Isaacson is there an apparent how -- -- I don't look at this and it is very Q&A -- are -- common -- --