With the current financial crisis, President Obama is making his efforts in the real estate sector by preventing foreclosures of homeowners. Fannie Mae and Freddie Mac widened their refinancing terms up to 125 percent of a home’s value instead of the current 105 percent loan-to-value cap. This program is intended for homeowners who are struggling to pay up their mortgages.

Housing prices in the US collapsed and with that homeowners have to pay mortgage that is more than the value of their home. This is where the problem roots from.