Romney Wants To Make Foreclosure Prevention Easier

By Sari R. Updated on 9/24/2012

Mitt Romney wants to get rid of President Obama’s current foreclosure prevention programs so that more private deals can be made between borrowers and banks.  Romney states that his housing plan will allow homeowners to have other options besides foreclosure, such as shared appreciation, short sales, and deed-in-lieu-of-foreclosures. 

If Romney were to be elected, he would play with accounting logistics in order to make the appeal for shared-appreciation more widespread.  One way of doing this is if lenders could sell future appreciations separately from first mortgages or could hold them at market value. 

Romney claimed that mortgage servicers would reduce principal and share the value that has been appreciating in an effort to help the 10.8 million homeowners currently underwater. 

Romney stated, during the primaries, that he would allow localized markets to “hit bottom” and allow investors to clear the foreclosed leftovers. He also vowed to overturn the Dodd-Frank Act, and was a harsh critic of the upcoming mortgage rules made by the Consumer Financial Protection Bureau.  If elected, Romney also wants to reform Fannie and Freddie, but hasn’t discussed privatizing the GSEs.