Casey introduced Senate version of the foreclosure mitigation funding
WASHINGTON, DC – After the House and Senate conference committee reached agreement on Wall Street Reform that includes funding to help keep workers who lost their jobs in their homes and to help stabilize the housing market, U.S. Senator Bob Casey (D-PA) applauded the agreement that will provide $2 billion in foreclosure mitigation funds to the Department of Housing and Urban Development -- $1 billion for an Emergency Homeowners Relief Fund and $1 billion to the Neighborhood Stabilization Program.
“This funding will help keep people in their homes, stabilize property values and the housing market,” said Senator Casey. “I thank my colleagues for including this important assistance in the final Wall Street reform bill. This funding will help keep laid off workers in their homes and continues the good work of the Neighborhood Stabilization Program helping homeowners weather the current economic climate. The need far outstrips the money available.”
Senator Casey introduced these provisions as a freestanding bill, the Homeowners’ Relief and Neighborhood Stabilization Act of 2010, and as an amendment to the Wall Street reform bill in the Senate, the Restoring American Financial Stability Act of 2010 (S.3217). This legislation is modeled on the Homeowners’ Emergency Mortgage Assistance Program (HEMAP) administered by the Pennsylvania Housing Finance Agency since 1983.
According to RealtyTrac, foreclosures in Pennsylvania increased by 20% from 2008 to 2009 and nationally by 21% to a record 2.8 million foreclosure filings in 2009.
Title VIII of H.R. 4173 addresses the foreclosure crisis by redirecting funds to successful foreclosure mitigation programs. First, it provides $1 billion for an Emergency Homeowners Relief Fund modeled after the Homeowners’ Emergency Mortgage Assistance Program (HEMAP), a Pennsylvania program administered by the Pennsylvania Housing Finance Agency since 1983. It is designed to respond to high unemployment situations where homeowners are temporarily unable to afford their monthly mortgage payments. The amendment provides for loans to homeowners only after determining that the borrower has a reasonable prospect of being able to resume making full mortgage payments and to consider ability to repay in establishing the loan terms, conditions and rates.
In addition, neighborhoods across the country continue to suffer from housing price declines, lost property tax revenues, abandoned properties and blight. The amendment will also direct $1 billion in TARP funds to the Neighborhood Stabilization Program, created by the Housing and Economic Recovery Act of 2008 (HERA), to provide grants to state and local governments and eligible entities to purchase and redevelop foreclosed and abandoned properties with the goal of stabilizing communities.
Congresswoman Maxine Waters introduced similar legislation in the House of Representatives that was included in H.R. 4173, the Wall Street Reform and Consumer Protection Act of 2009 which passed the House of Representatives.
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