NEW YORK ( TheStreet) -- Despite a recovery in housing, there's still a call for more policy action to stimulate the market. But, according to Michelle Meyer, an economist at Bank of America Merrill Lynch, there could be more talk than action in Washington this year. One reason is that the Obama administration has few options that can win favor in Congress. While the government's Home Affordable Refinancing Program (HARP) has taken off, after a rough start, this option is available only to those with government-backed mortgages. Those with private mortgages, especially those with negative equity, have had more trouble accessing refinancing options and have been unable to tap into low interest rates. The president has proposed allowing those with privately owned mortgages to refinance through the Federal Housing Administration -- he reiterated the promise in his State of the Union address this week -- but that requires Congressional approval. Few analysts expect Republicans to approve the bill, given that it calls for an expanded role of the FHA, which is already in financial trouble. The Treasury Department could lower interest rates on mortgages through its Home Affordable Modification Program (HAMP) and compensate investors through a small payment. But even this is "not very realistic," according to Meyer. "The Treasury can potentially draw upon the remaining TARP money allocated to housing -- only $6.7 billion of the $45.6 billion has been used -- but that would not be sufficient." The modification program has not been very successful, partly because the government has not been able to convince the Federal Housing Finance Agency (FHFA), the conservator of Fannie Mae and Freddie Mac, to reduce the principal on mortgages. FHFA Director Edward DeMarco has argued that other alternatives such as forbearance might be equally successful in helping borrowers without encouraging willful defaults. The Obama administration is under pressure to replace DeMarco. But even then the FHFA is unlikely to change its stance, according to Meyer. So while the conversation on housing policy could heat up this year, especially around more modification and refinance options, there could be little further action. Instead, Meyer expects a more lively debate on the future of the mortgage finance system.