For who?
To help the Fed, the federal government might make mortgage interest at less than 3.5% not deductible.
Which politicians are going to vote to screw people with low-rate mortgages?
The Fed might then offer to refinance below 3.5% mortgages at higher rates.
The Fed has no retail banking operations.
“For who?”
For the taxpayers.
“Which politicians are going to vote to screw people with low-rate mortgages?”
The 2.67% Trump Covid era mortgages were political handouts. The mortgagors got a too sweet deal. Even mortgages refinanced at 3.5% would be a sweetheart of a deal.
“The Fed has no retail banking operations.”
People who don’t refinance will simply not get an interest deduction anymore.