Tuesday, March 6, 2012
New Mortgage Rates will save homeowners $1000 a year
New mortgage rates will save homeowners $1,000 a year By Theresa Seiger WASHINGTON (RNN) - President Barack Obama held his first official news conference of the year Tuesday to announce changes in mortgage financing that he said will save homeowners approximately $1,000 a year. Mortgage rates for houses financed by the Federal Housing Administration will be cut by more than half, Obama said. The White House estimates that between 2 million and 3 million borrowers could benefit from the lowered rate. The FHA charges an up-front mortgage insurance premium of 1 percent of the borrower's loan balance and an additional 1.15 percent of the balance per year. The reduction would change the up-front premium to .01 percent for loans that were taken out before June 1, 2009 and change the annual fee to .55 percent. The president said the efforts are part of his goal of "ensuring this recovery touches as many lives as possible." More changes will come for military families struggling in the economic recession, including hundreds of thousands of dollars of compensation for service members who have been wrongfully foreclosed upon since 2006. Service members will also get refunds if they prove that they were wrongfully denied the chance to reduce their mortgage payments through lower interest rates. Obama also made another pitch for increasing taxes on high-income Americans, calling on Congress to vote on the Buffett Rule, a tax plan inspired by investor Warren Buffett. In early 2011, Buffet said that the rich should pay a higher tax rate than the middle class. The plan would raise the minimum tax rate for payers in the highest income bracket, "so we don't have billionaires paying a lower tax rate than their secretaries," Obama said. The comments came as economic confidence in the country experienced a sixth straight increase, according to research from Gallup. Although the rise has not been dramatic, confidence has reached average monthly high levels seen in the previous four years. According to Gallup, people making less than $24,000 a year had the most negative view of the economy while those making $90,000 or more had the highest perception. Obama's news conference came on Super Tuesday, as the GOP presidential hopefuls battle it out across 10 states for more than 400 delegates. Primaries are being held in Massachusetts, Vermont, Idaho, Virginia, Ohio, Georgia, Tennessee, Oklahoma, North Dakota and Alaska. Mindful of the coming election, Obama told reporters that comments from the candidates on the possibility of war with Iran reminded him that "those folks don't have a lot of responsibility." "When I see the casualness of how these people talk about war, I'm reminded of the costs of war," he said. "There's nothing casual about it. When I see some of these folks who have a lot of bluster… but when you ask them specifically what they're going to do, they repeat the things that we've been doing for the last three years. "Those who are suggesting, or proposing, or beating the drums of war should explain clearly to the American people what they think those costs and benefits will be," he said. He reiterated his goal of achieving a diplomatic solution to the problem with Iran, a country rumored to be working on producing nuclear weapons. He said top intelligence officials from both the U.S. and Iran agreed this can be accomplished without war. However, he said there is no room for compromise when it came to allowing Iran to achieve nuclear capability. "Iran is politically isolated," Obama said. "We will not countenance Iran getting a nuclear weapon. My policy is not containment, it is prevention." Copyright 2012 Raycom News Network. All rights reserved.