President Barack Obama says his new mortgage refinancing plan would provide relief for what he described as responsible homeowners who make mortgage payments on time.
President Obama would like to expand a federal housing initiative allowing homeowners to refinance at a lower rate.
The president made his pitch in Falls Church, Va. on Wednesday.
Obama said the nation's housing crisis is damaging not only the U.S. economy, but also what it means to be middle class in America.
He told the crownd in northern Virginia that while government alone can't fix the problem, Congress must do what it can to help struggling homeowners.
Obama is outlined a proposal to allow millions more homeowners to refinance their mortgages at lower interest rates even if they owe more than their homes are worth. The White House says the average borrower could save about $3,000 annually.
In a veiled shot at his GOP rival Mitt Romney, Obama said homeowners struggling to pay their mortgage shouldn't have to sit and wait for the housing market to hit bottom. Romney has previously said the housing market needs to bottom out.
The administration's proposal faces a major hurdle in Congress. The program would be paid for by a fee on large banks. The administration has tried unsuccessfully before to win support for assessments on large banks.
The plan would expand the administration's Home Affordable Refinance Program, which allows borrowers with loans backed by government-affiliated mortgage giants Fannie Mae and Freddie Mac to refinance at lower rates. About 1 million homeowners have used it, well short of the 4 million to 5 million the Obama administration had expected. Moreover, many ``underwater'' borrowers - those who owe more than their homes are worth - couldn't qualify.
Private economists have estimated that expanding the plan to all borrowers could allow up to 10 million homeowners to refinance, giving the economy a significant jolt. The Federal Reserve has been less sanguine, estimating that 2.5 million more Americans might be eligible to refinance through the expanded program.
Under the refinancing plan, any homeowner current on his or her mortgage could take advantage of historically low lending rates. The average rate for a 30-year mortgage is 3.88 percent.
About 11 million Americans - roughly 1 in 4 with a mortgage - are underwater, according to CoreLogic, a real estate data firm.
Half of all U.S. mortgages - about 30 million home loans - are owned by nongovernment lenders.