The Obama administration originally explored legislation that would have reduced barriers to refinancing for underwater mortgage borrowers but turned to the Federal Housing Finance Agency instead, according to the head of the president's economic team.

"Refinancing has been a key focus for President Obama," said Gene Sperling, director of the National Economic Council. "He considered putting forward legislation through the jobs act. We made a decision that there was a good opportunity to work with the industry and the FHFA to move forward without new legislation."

The FHFA announced changes to the Home Affordable Refinancing Program Monday. By eliminating upfront fees, negative equity caps, appraisal requirements and putback risks on the original loan file, the FHFA said the program could double, while most analysts said the result would be modest.

Former Special Inspector General of the Troubled Asset Relief Program Neil Barofsky said on Bloomberg television Monday that the program revamp doesn't address the core issue facing the housing market and like other programs before it remains "tepid."

Requiring possibly stricter guidelines for refinancing through federal law was considered, Sperling said, but the administration didn't think Congress would pass such a reform.

"Here was a place where we felt there were significant steps that could be taken that could make a major difference for so many homeowners right now. We understand there could be other types of actions taken, but you have to weigh the possibility of that passing and the time it would take," Sperling said. "There are more steps we could take in this fashion."

Obama brought in Sperling, a veteran of the Clinton administration, at the beginning of the year. The Washington Post reported he was selected for his ability to wrangle economic policies out of a hostile Congress. But not even Sperling could push a major refinancing bill through a capital so polarized it brought the country within hours of a default on its sovereign debt earlier in the year.

House Republicans specifically have been at work during the current session attempting to unwind several underwhelming foreclosure prevention programs such as the Home Affordable Modification Program.

Leaders on GOP-controlled House Financial Services Committee, which has led this charge, did not immediately have a comment on the HARP changes Monday morning.

Sens. Barbara Boxer (D-Calif.) and Johnny Isakson (R-Ga.) introduced legislation to do so twice this year, but it didn't make it through committee. Both applauded the administration action Monday as "a good start."

With Obama on the road — in Nevada on Monday — pitching several pieces of his jobs bill earlier rejected by a Republican filibuster in the Senate, he has begun looking for ways to navigate around a gridlocked Washington and boost economic growth through executive action, Sperling said.

Department of Housing and Urban Development Secretary Shaun Donovan said in a conference call Monday there was never much hope of Congress acting to usher more underwater borrowers into a lower-rate loan.

"Getting legislation done for refinancing more mortgages simply hasn't been in the cards," Donovan said.

Write to Jon Prior.

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