Washington, D.C. -— U.S. Rep. Bob Etheridge voted today for legislation that would address the housing crisis at the root of the current economic downturn.
The package of housing measures will help to improve home values and to keep more Americans from losing their homes. It will also help local communities to limit the negative consequences of home foreclosure.
“Owning a home is a big part of the American dream,” said Etheridge. “The current housing crisis affects all homeowners by bringing down home values and slowing the economy. Today’s legislation will help to end this crisis and put the American economy back on track.”
In 2007, 37,062 homes in North Carolina were foreclosed on and the number is expected to increase in 2008. According to the Pew Charitable Trust, the value of 332,375 N.C. homes decreased from the spillover impact, with the state losing about $861 million in property values.
H.R. 3221, The American Housing Rescue and Foreclosure Prevent Act of 2008, will provide mortgage refinancing assistance to help keep families from losing their homes and to protect neighboring home values. The bill also expands Federal Housing Administration initiatives that allow borrowers in danger of losing their home to refinance with lower-cost government-insured mortgages.
The plan requires both homeowners and lenders to take responsibility. To qualify for refinancing and a new government-backed mortgage, lenders and mortgage investors will be required to take a loss and borrowers must share any profit from the resale of a refinanced home with the government. Additionally, the new plan is open only to owner-occupied homes. Speculators, investors and vacation/second-home owners are not eligible.
H.R. 5818, the Neighborhood Stabilization Act, would aid in the recovery of communities harmed by empty homes caught in the foreclosure process. The bill will help local communities to address some of the consequences of foreclosures, such as declining home values, increased crime, and decreased revenue from local property taxes. It would provide $15 billion in loans and grants to states to acquire foreclosed homes standing empty, to rehabilitate foreclosed property and to restore home values in neighborhoods hit hard by the crisis.