Pelosi Statement on U.S. Conference of Mayors Report on Mortgage Foreclosure Crisis

    WASHINGTON, Nov. 27 /PRNewswire-USNewswire/ -- Speaker Nancy Pelosi
 issued the following statement on a report issued today by the U.S.
 Conference of Mayors on the economic impact of the mortgage foreclosure
 crisis. Below the statement is a fact sheet on action taken by the House of
 Representatives to address the mortgage crisis:
 
 
 
     "Today, the U.S. Conference of Mayors released a significant report
 warning of the impact of the mortgage foreclosure crisis - a weakening of
 our economy and the economic security of American families. As individuals
 struggle with the subprime mortgage crisis, the report concludes that its
 impact could be nationwide, with weak residential investment, lower
 spending in the construction industries, and curtailed consumer spending.
 This demands serious solutions.
 
 
 
     "Already this year, and with the support of America's mayors, the House
 has taken swift action to help families struggling to make mortgage
 payments and avert this potential economic downturn. With bipartisan
 support, we have reformed the Federal Housing Administration so it can help
 people at risk of foreclosure stay in their homes with affordable loans and
 refinancing options; taken comprehensive anti-predatory action to prevent
 bad loans from being made in the first place; and expanded housing
 counseling for distressed families who are at risk of losing their homes."
 
 
 
 
 
     November 27, 2007
 
 
 
     New Direction Congress Taking Swift Action on Subprime Housing Crisis
 
 
 
     Reform FHA to Expand American Homeownership: In September, the House
 passed a bipartisan bill to enable the Federal Housing Administration (FHA)
 to serve more subprime borrowers at affordable rates and terms, recapture
 borrowers that have turned to predatory loans in recent years, and offer
 refinancing loan opportunities to borrowers struggling to meet their
 mortgage payments in the midst of the current turbulent mortgage markets.
 These reforms, including provisions to lower down payments and increase
 loan limits, would help some 200,000 additional families, if not more,
 purchase or refinance into safe FHA-insured mortgages. (Expanding American
 Homeownership Act of 2007, H.R.1852)
 
 
 
     Prevent Future Subprime Crisis / Strengthen Protections Against Risky
 Loans: To prevent these bad loans from being made in the first place, the
 House has passed comprehensive anti-predatory lending legislation -- making
 sure that consumers get mortgages they can repay, strengthening consumer
 protections against reckless and abusive lending practices, and giving
 consumers the ability to seek redress. This bipartisan bill will make sure
 that the mortgage industry follows basic principles of sound lending and
 consumer protection, ensuring that: borrowers receive clear disclosures
 about the loans they are offered, borrowers are not "steered" into more
 expensive mortgages, special consumer protections are strengthened for
 high-cost loans, and all mortgage bankers and bank loan officers are
 licensed or registered. (H.R. 3915, the Mortgage Reform and Anti-Predatory
 Lending Act of 2007)
 
 
 
     End Taxes on Mortgage Debt Forgiveness: The House passed a bipartisan
 bill to end the tax on phantom income when a lender forgives some part of a
 family's mortgage in foreclosure. Under current law, the debt forgiven
 following mortgage foreclosure or renegotiation is considered income for
 tax purposes, resulting in tax liability for individuals and families. The
 bill provides tax relief by permanently excluding this mortgage debt
 forgiven under these circumstances from taxes. (H.R 3648, Mortgage
 Forgiveness Debt Relief)
 
 
 
     GSE Reform/Make Fannie Mae and Freddie Mac Loans Part of the Solution:
 The House has passed comprehensive and bipartisan GSE legislation (H.R.
 1427) to improve the regulation of Fannie Mae and Freddie Mac, and the
 Federal Home Loan Bank system. The bill raises the GSE loan limits for
 single family homes in high cost areas, so that these entities could
 purchase more loans in higher cost areas (lowering interest rates for new
 homes and refinancings in those areas). These government-sponsored
 enterprises (GSEs) provide liquidity to the mortgage markets by buying
 loans already made, freeing up money for new mortgages and refinances.
 
 
 
     Housing Counseling to Prevent Foreclosures: The House has passed
 legislation to invest $200 million for housing counseling to assist many
 distressed homeowners who are trapped in unaffordable loans to prevent
 foreclosure. (Conference Report on H.R. 3074, Transportation Housing
 Appropriation)
 
 
 
     Affordable Housing: The House has passed legislation to establish a
 national affordable housing trust fund to build or preserve 1.5 million
 homes or apartments over the next 10 years, without increasing the federal
 deficit. Increasing the supply of affordable housing will help ensure that
 families who have lost their homes due to predatory lending or a family
 financial crisis, such as ill health or job loss, can find housing. (H.R.
 2895, National Affordable Housing Trust Fund Act of 2007)
 
 
 
     More Progress to Come: Congress Will Act to Strengthen Protections
 
 
 
     Fair Treatment for Homeowners in Bankruptcy: The House Judiciary
 Committee is considering legislation to prevent up to 600,000 Americans
 from losing their homes in bankruptcy over the next two years -- by giving
 bankruptcy judges the ability to revise mortgage contracts on primary
 mortgages, much as they already do when sorting out payments to other kinds
 of creditors and other mortgages, such as vacation homes. This bill will
 permit bankruptcy courts to give homeowners more time to pay their
 mortgages with more reasonable interest rates. (H.R.3609 Emergency Home
 Ownership and Mortgage Equity Protection Act of 2007, Rep. Brad Miller)
 
 
 
 
 
 
 
 
 
 
 
 
 

SOURCE Office of the Speaker of the House