Obama meets with Reno family, pushes for extension of home refinancing program

By David McGrath Schwartz

Published Friday, May 11, 2012 | 12:46 p.m.

Updated Friday, May 11, 2012 | 4:43 p.m.

President Barack Obama rinsed off the glitz of a Los Angeles fundraiser and basketball game with George Clooney in an underwater Northern Nevada neighborhood Friday, calling for Congress to expand a program that allows homeowners to refinance if they owe more on their mortgages than their homes are worth.

Standing outside a Reno home, in front of the owners who refinanced under the existing federal program, Obama said Republicans in Congress should take action.

He urged them to “come to Reno to visit ... Talk to people whose lives are better because of action we took. They’re not looking for a handout, but to make sure someone is looking out for them.”

Republicans in Congress, Obama said, wanted to recycle ideas like tax cuts for the wealthy and “letting the housing market hit bottom.”

“We tried those ideas for nearly a decade,” he said. “They just don’t work.”

The current program, launched by Obama because of gridlock in Congress, is only open to those who have federally backed mortgages.

He spoke to about 100 neighborhood residents in front of Val and Paul Keller’s house, in north Reno.

The Kellers owed $168,000 on their mortgage, but their home is currently valued at $100,000. CNBC reported that they refinanced in 2007, when their home had appreciated to $250,000.

The couple has not missed a payment on their house in the 14 years they have lived there, the president said.

Their monthly payment went down $240 when they qualified for the federal program this year, money that Obama said they could spend in the economy or put back into the house to build back equity.

Obama asked that people contact Congress, as part of his “to-do” list for Congress, to take a “small step to help the economy.”

The crowd had a mix of ardent Obama supporters who cheered his entrance and others who were drawn to the scene for the chance to see him in person.

Some, including Val Keller, said they were still undecided about who to support in November’s presidential election, in which Nevada is one of a handful of swing states that will determine the outcome.

After a 10-minute conversation with Obama around her kitchen table, where she said the president asked about the economy and their family, Keller said she didn’t know who she’d vote for.

“I’m leaning (toward Obama),” Keller said. “But I’m still undecided. I’m still watching the economy.”

A van plastered with a sign that said Obama was a socialist drove around the neighborhood before the event. A hand-written letter on one of the houses down the street said, “I’m a proud American not an Obama supporter.”

Jean O’Doan, a 46-year-old accountant, said she was not an Obama supporter but brought her 8-year-old son Luke to see the president. “He’s still the president. It’s still an honor.”

She said the housing issue affected everyone, including herself. She was investigating using the federal program to refinance her home, valued today at $200,000 but for which she owes $320,000.

But, she said, “I don’t believe in the government bailing me out,” she said. “I do believe in less government.”

Debbie Davison, and her husband Jim, who are neighbors of the Kellers, said they too are underwater.

The house “was going to be my retirement,” Debbie Davison, a casino bartender, said. “Now I don’t know if I’ll be able to retire.”

Obama stressed that the program he wants expanded is for homeowners who have not defaulted or fallen behind on their mortgages.

Congress “could make every homeowner in America who is underwater right now eligible to be able to refinance their homes if they’re making their payments, if they’re responsible,” he said.

But that’s harder and harder for some.

Paul Mortlock, also of Reno, said he and his wife Connie stopped making payments on their house three years ago, when their loan payment ballooned.

“I feel bad enough about not paying,” he said. “But this economy ... I’m not a low-life.”