Congressman Dennis Cardoza (D., Calif.) plans to introduce a blanket modification effort for GSE loans that could see as many as 30 million U.S. mortgage borrowers refinance their mortgages at record low interest rates.

According to a Reuters report, borrowers would be eligible for refinancing regardless of their income, credit history or LTV ratio.

The legislation would allow anyone seeking to refinance a 30-year, fixed-rate government-backed mortgage at the market rate, which is now around 4.3%, Reuters reported.

Jesse Litvak, a mortgage trader at Jefferies & Co., said that if the plan catches on it could tip the balance toward a giant GSE refinancing wave.

"The only reason we are not seeing massive refinancing at these rates is exactly because [borrower's] don't have the credit and are underwater," Litvak said.

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