Dive Brief:
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President Barack Obama Thursday will announce a plan to lower mortgage insurance fees on home loans enough to save the average first-time borrower $900 a year.
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The president will make the announcement during a speech in Phoenix about the housing market. The White House said in a statement on Wednesday that the reduction is part of Obama’s effort “to expand responsible lending to credit-worthy borrowers.”
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The White House projects that reducing annual mortgage insurance premiums by 0.5 percentage points to 0.85 percent from 1.35 percent could entice 250,000 consumers to buy homes over the next three years.
Dive Insight:
That could give homebuilders a boost: “An increase in first-time homebuyers and more affordable mortgages will help spur more residential construction and help create new jobs in the housing sector,” the White House said in the statement.
Republicans, on the other hand, are reportedly not happy about the plan. House Financial Services Committee Chairman Jeb Hensarling (R-Texas) said in a statement that “such an action by the President would be a grave mistake that will end up hurting hardworking taxpayers.”