WASHINGTON, DC— U.S. Senator Bob Casey (D-PA) today joined Senator Kirsten Gillibrand(D-NY) in sending a letter to Senator Chris Dodd, Chairman of the Senate Committee on Banking, Housing and Urban Affairs, and Congressman Barney Frank, Chairman of the House Committee on Financial Services, urging them to include Title VIII of H.R. 4173 in the Wall Street reform conference report. Title VIII directs a total of $4 billion in foreclosure mitigation funds to the Department of Housing and Urban Development--$3 billion for an Emergency Homeowners Relief Fund and $1 billion to the Neighborhood Stabilization Program.
“Experts predict a new record of foreclosure filings in 2010, as well as ongoing home price declines,” the Senators wrote. “Implementing an emergency loan program targeting homeowners with prime loans who are temporarily unable to make their monthly payments will offer relief.”
RealtyTrac reports that the number of U.S. residential properties receiving at least one foreclosure filing jumped 21% in 2009 to a record 2.82 million housing units. Foreclosure activity increased sharply in March 2010 and the number of homes in some stage of the foreclosure process rose from the previous quarter.
Title VIII of H.R. 4173 addresses the foreclosure crisis by redirecting funds to successful foreclosure mitigation programs. First, it provides $3 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.
Senator Casey introduced these provisions as amendment 3891 to S. 3217 the Restoring American Financial Stability Act of 2010.
Full text of the letter is below.
###
Dear Chairman Dodd and Chairman Frank:
As the House of Representatives and Senate work to merge their respective versions of the financial regulatory reform bills, we urge you to press for inclusion of Title VIII of H.R. 4173 in the conference report. Title VIII directs a total of $4 billion in foreclosure mitigation funds to the Department of Housing and Urban Development--$3 billion for an Emergency Homeowners Relief Fund and $1 billion to the Neighborhood Stabilization Program. These provisions were introduced in the Senate by Senator Casey as amendment 3891 to S. 3217 the Restoring American Financial Stability Act of 2010. Unfortunately, the amendment did not come up for a vote in the Senate. Nevertheless, we encourage the conferees to take up Title VIII from H.R. 4173 to provide funding for programs that have a proven track record in addressing the foreclosure crisis.
Despite improvements in the broader economy, the housing market has seen little meaningful recovery. RealtyTrac reports that the number of U.S. residential properties receiving at least one foreclosure filing jumped 21% in 2009 to a record 2.82 million housing units. Foreclosure activity increased sharply in March 2010 and the number of homes in some stage of the foreclosure process rose from the previous quarter. Given the significant federal response to the foreclosure crisis, it is disheartening that foreclosure filings were up nearly 8% from March 2009, the highest monthly total since RealtyTrac began reporting the numbers in January 2005.
Title VIII of H.R. 4173 addresses the foreclosure crisis by redirecting funds to successful foreclosure mitigation programs. First, it provides $3 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. Experts predict a new record of foreclosure filings in 2010, as well as ongoing home price declines. Implementing an emergency loan program targeting homeowners with prime loans who are temporarily unable to make their monthly payments will offer relief.
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.
We encourage the conferees to include Title VIII of H.R. 4173 and thereby direct funding to programs that keep people in their homes and allow communities the opportunity to strengthen and rebuild. Thank you for considering this critical set of reforms.
Sincerely,
Robert P. Casey, Jr., U.S. Senator
Kirsten E. Gillibrand, U.S. Senator
