The Pittsburgh Post Gazette wrote earlier this week that Ginnie Mae President, Joesph Murin is urging homeowners to take advantage of mortgage rates near 60-year lows by refinancing. He feels that reports of rampant foreclosure problems in Michigan, Ohio, Florida and other troubled housing markets have given people a dimmer view of the economy than is merited.
"It’s a state of mind. It’s fear, and I personally think it’s not justified," Murin told the Pittsburgh chapter of the Financial Planning Association. Consumer confidence continues to be low and a recent poll by Realtor.com showed that about 50 percent of Americans think they or someone they know could face foreclosure in the next six to 12 months.
"That’s an incredible amount of doom and gloom," Mr. Murin said. He believes that the pessimism is overdone, adding, "I’m somewhat of a realist but certainly an optimist."
Refinancing would boost the economy by lowering monthly mortgage payments for borrowers, Murin said. More importantly, it would give federal policymakers a clearer idea of how many problem loans remain and what to do about them. "The more we can refinance, the better the picture will clear up for us," he said, in an interview after his speech.
Murin also advised financial planners to be prepared to help their clients with reverse mortgages. He said reverse mortgages would make increasing sense for homeowners in their 70s or older who are living longer and whose retirement savings have been squeezed by the stock market’s fall and rising health care costs.
"I think more and more people will be coming to you asking about them," he said. According to Ginne Mae’s reports, the GSE has issued $313 Million worth of HECM MBS in 2009.
