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White House Opposes Frank Foreclosure Plan
The House Financial Services Committee last week considered plans to provide foreclosure relief for strapped borrowers. On April 23, the panel voted 38 to 26 to approve a measure that would provide $15 billion in loans and grants that local governments could use to house low-income families and to purchase and rehabilitate homes in foreclosure.
The following day, the committee began debate on legislation (H.R. 5830) put forth by Chairman Barney Frank (D-Mass.) that would allow the Federal Housing Administration to insure up to $300 billion in refinanced mortgages — but only after lenders cut down the size of the loans first to make them more affordable to borrowers. While the committee is expected to complete consideration of H.R. 5830 on April 30, the Administration has already come out in opposition to the measure.
Roy Bernardi, Housing and Urban Development deputy secretary, sent a letter to Frank warning that the Administration “strongly opposes” the bill. “This legislation may come at a cost to taxpayers who are not participating in the new program,” Bernardi wrote. “An attempt to shift costs to taxpayers would constitute a bailout.” Nevertheless, Frank has expressed hope that the House will act next month on his plan — either as a stand-alone bill or part of a broader housing package.
Meanwhile, Senate Banking Committee Chairman Chris Dodd (D-Conn.) plans to hold a markup on May 6 to consider his HOPE for Homeownership proposal, legislation similar to Frank’s that would create a new initiative within the FHA to refinance mortgages of distressed home owners. Dodd has also indicated that he would like to consider a GSE reform package on the same day. At this point, no Senate legislation on the overhaul of Fannie Mae and Freddie Mac has been introduced.
Outcome Uncertain
The situation remains fluid and it is still unclear whether these bills will move forward individually or be merged into a giant housing package.
The Senate on April 10 approved a housing stimulus bill (H.R. 3221) that would provide a temporary tax credit for purchasers of foreclosed properties; modernize the FHA and permanently raise the maximum loan amount that the agency could insure to $550,000; allow businesses to carry back net operating losses for four years; and expand the mortgage revenue bond program.
The House Ways and Means Committee approved its own housing stimulus legislation at about the same time the Senate acted. The House legislation would create a first-time home buyer credit of up to $7,500 for the purchase of any home within the next 12 months. The credit would be available for married couples making up to $140,000 annually ($70,000 for singles). And it would significantly enhance the Low Income Housing Tax Credit and tax-exempt housing bond programs.
Builder to Deliver Urgent Message to Capitol Hill
NAHB is monitoring developments closely and continues to push House members to move quickly to bring a final bill to the House floor.
More than 1,200 builders are expected to assemble on Capitol Hill on April 30 during NAHB’s Legislative Conference and urge their members of Congress to move quickly to pass housing stimulus legislation that will jump-start housing and the economy. For those builders who cannot attend, NAHB’s grassroots is setting up an 800 phone number so that members can contact their lawmakers on April 30 and advocate for housing issues.
In conjunction with the Legislative Conference, NAHB is running ads in CQ Weekly, Roll Call, Politico, CQ Today and CongressDaily with the message that Congress can avert an economic crisis, save jobs and restore confidence in the housing and financial markets, if it listens to the urgent message that home builders will be delivering on April 30.
As the House stimulus bill moves forward and is reconciled with the Senate version, NAHB will continue to work with Congress to produce the best legislation possible.
To view legislation, click here and type the bill number in the box at the center of the page.
For more information, e-mail Scott Meyer at NAHB, or call him at 800-368-5242 x8144.
 Mark Your Calendar for the 2008 NAHB Legislative Conference
The 2008 NAHB Legislative Conference provides a unique opportunity for builders to meet with their members of Congress, discuss the issues that affect their business and bottom line and establish a lasting relationship with their elected federal officials.
The day-long conference on Wednesday, April 30 coincides with the NAHB spring board meeting in Washington, D.C.
Builders are encouraged to travel to the nation’s capital to urge their representatives and senators to support policies that stabilize housing, restore confidence in the credit markets and bolster the nation’s economy.
Members of Congress are being urged to:
- Support a temporary home buyer tax credit to boost sales, reduce excess inventory in housing markets and halt the dangerous erosion of house prices
- Enact Federal Housing Administration modernization to assist first-time and moderate-income home buyers and alleviate the mortgage credit crunch
- Adopt comprehensive reform legislation for Fannie Mae and Freddie Mac to enable these financial institutions to provide badly needed liquidity to the mortgage market
- Expand the mortgage revenue bond program to help strapped borrowers refinance existing loans
- Allow businesses to carry back net operating losses for more than two years to save jobs and help them weather the economic storm
For more information and to register for NAHB’s 2008 Legislative Conference, click here; or e-mail Molly Murray at NAHB, or call her at 800-368-5242 x8282.
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