Housing and Urban Development Secretary Shaun Donovan on Friday urged passage of three refinancing bills in the U.S. Senate but admitted that time was running short in a politically charged election year.
Donovan hosted a refinancing round table with Denver Mayor Michael Hancock and housing advocates, banking-industry representatives and community leaders.
He said the number of homeowners who are underwater in their mortgages — owing more than the property is worth — has become a critical issue but is solvable during times of historically low interest rates.
In the second quarter of this year, about one in four homeowners in the Denver area had negative equity, but that figure was a slight improvement over the first quarter.
The series of bills sponsored by Democrats would create more refinancing opportunities for borrowers to lower interest rates and reduce their monthly payments, reduce their principal owed or save on closing costs, helping get them back “above water” faster, he said.
That, in turn, should increase consumer spending and boost the economy.
“Our view is this is one of the simplest, most common-sense things we can do to help accelerate the economic recovery,” he said. “We’re doing a lot already, but we can go further.
“This is a priority for the president and something that in the past has had bipartisan support. But the fact is we’re in a political season when this may be hard to do. There are something like eight working days that the Senate is going to be in session between now and the election. That’s it.”
