Obama administration looks to stimulate housing market

WASHINGTON

According to the New York Times, one proposal would allow homeowners with government-backed mortgages to refinance them at today's lowest interest rates - which are about 4 percent. Another plan is a home rental program. It would try to stabilize up housing prices by preventing foreclosed homes from flooding the market.

Officials say a wave of refinancing could be a strong stimulus to the economy because it would lower mortgage bills right away and allow them to spend elsewhere. However, despite record low interest rates, many homeowners haven't refinanced their loans either because they owe more than their houses are worth or because they have bad credit.

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