Obama Proposes New Refinancing Program

Washington, DC, Feb. 2, 2012 -- President Barack Obama proposed a plan to help millions of underwater homeowners refinance their mortgages.

The plan would allow borrowers who are current on their payments to save money by refinancing into loans backed by the Federal Housing Administration, according to the U.S. Department of Housing and Urban Development.

The cost is estimated to range between $5 billion and $10 billion. To pay for it, Obama is proposing to impose a fee on large banks.

What's new about the proposal is that it would help borrowers with private bank loans who could not refinance previously because their loan balance was higher than their home's value.