Congressman John Olver's Housing and Mortgage Reform Legislation Update:
| The recent problems in the subprime mortgage markets have pushed the housing market into its worst slump in 16 years. There is currently an epidemic of subprime foreclosures that primarily affects hard-working families who’ve become victim of faulty loans. Subprime mortgages are high-cost home loans intended for people with weak or blemished credit histories. The subprime market has been rife with problems that are rare in the mainstream prime market: excessive fees, high penalties for refinancing, refinances that provide no real benefit to homeowners and steering families into more expensive loans when they qualify for a better rate. The crisis in the subprime market has spread to other consumers seeking home loans, has driven home prices down, and has spread into U.S. and international financial markets. On November 15th, the House of Representatives passed H.R. 3915, the Mortgage Reform and Anti-Predatory Lending Act of 2007. This legislation responds to the subprime mortgage crisis by instituting much needed reforms to prevent these types of loans from being made in the first place. The bill: • Requires lenders to ensure a borrower’s ability to repay a loan. In addition, Congress has passed H.R. 2895, The National Affordable Housing Trust Fund Act of 2007, which will increase the supply of affordable housing over the next ten years without increasing the federal deficit. The House also voted to end taxes on mortgage debt forgiveness following mortgage foreclosure or renegotiation and I am hopeful for Senate action. This legislation is just one of the many ways that the 110th Congress is acting to strengthen the housing market and the economy. As you may know, I currently chair the House Appropriations Subcommittee on Transportation and Housing, and Urban Development (HUD). Our fiscal year 2008 appropriations bill included $250 million to help with the current foreclosure crisis. We have included $200 million over the President’s request for the Neighborhood Reinvestment Corporation, a recognized intermediary between lenders and homeowners, to help individuals and families forestall foreclosure and keep their homes. A separate $50 million is provided for HUD’s housing counseling program to help new potential home buyers avoid future foreclosures. There are many resources both national and local that are in place to help homeowners avoid foreclosure. I have provided the information for some useful organizations below. We have much to gain by ensuring that home mortgage loans are being made in an honest and reputable way. Millions of Americans have benefited from homeownership and we should make sure that millions more are not stripped of their homes and left in debt because of the actions of unscrupulous lenders. Please be assured that I will continue to work towards solutions that will alleviate the stress on homeowners. Sincerely, John W. Olver Resources for Homeowners Facing Foreclosure U.S. Department of Housing and Urban Development (HUD): HUD provides a variety of resources for homeowners at risk of foreclosure including free housing counseling services throughout the country. Massachusetts Department of Housing and Community Development: Mass DHCD has a number of resources for homeowners including counseling resources. Neighborworks: Neighborworks is a national network of more than 240 community based nonprofit organizations created by Congress to provide financial support, technical assistance, and training for community revitalization efforts. |
