Capps Cheers Passage of Fair and Effective Plan to Help Our Economy by Helping Americans Keep Their Homes

The Helping Families Save Their Homes Act Could Keep Hundreds of Thousands of Families from Losing Their Home Without Spending One Taxpayer Dollar

WASHINGTON, D.C. – March 06, 2009 – (RealEstateRama) — Today Congresswoman Lois Capps voted for legislation that will provide a fair and effective plan to help communities across the country by aiding families who are facing foreclosure hold on to their homes. As families and neighborhoods up and down the Central and South Coasts struggle with declining home values and increasing foreclosures the local economy has similarly suffered. Addressing our national housing crisis is an essential step in rebuilding our larger economy. The Helping Families Save Their Homes Act (HR 1106) will put in place a key piece of President Obama’s comprehensive Homeowner Affordability and Stability Plan. The legislation passed the House by a vote of 234 to 191. The Senate is working on similar legislation and hopes to have their version of the bill passed by the April District Work Period beginning April 6th, 2009. The President announced details of his plan yesterday, including a website, www.financialstability.gov, with an eligibility quiz for homeowners struggling to make their payments.

“Clearly the current crisis in the housing market has played a central role in our economic downturn,” said Capps. “This housing meltdown has been devastating for families and communities, particularly for the innocent families who lived within their means, paid their mortgages on time but through no fault of their own find their home values eroding and their life savings threatened. This is not about bailing out lenders or borrowers who made irresponsible decisions. It’s about finding fair and effective solutions to stabilize the housing market. Passing the Helping Families Save Their Homes Act will help us revitalize our housing market and thereby aid the recovery of the larger economy. I am proud to support this legislation that offers a fair approach to our housing crisis—and work with the President to help 7 to 9 million American families avoid foreclosure, and their neighbors from continuing to lose value in their homes.”

The Helping Families Save Their Homes Act gives bankruptcy judges the ability to modify existing mortgages on primary residences for families who file for Chapter 13 bankruptcy. This will help families avoid foreclosure by incentivizing lenders to voluntarily modify loans. The bill also gives lenders the confidence to modify loans by protecting them from some lawsuits. And it spurs mortgage refinancing by fixing the Federal Housing Administration’s Hope for Homeowners Program, reducing fees and offering new incentives for lenders.

Chapter 13 bankruptcy filing is a last resort for many families who are unable to make ends meet in the midst of this recession. It is a strict and intrusive process that forces a family to open their finances up to the scrutiny and management of the courts for up to five years.

This legislation is critical to the overall recovery of our economy. A record 5.4 million homeowners were either behind on payments or in foreclosure at the end of last year. Home prices dropped 18 percent in the last quarter of 2008. More than 14 million homeowners owe more on their mortgage than their home is worth, and they cannot refinance. Many are facing foreclosure through no fault of their own. This is an important step in helping America’s economic recovery.

Please click here to watch Congresswoman Capps speech on the Homeowner Affordability and Stability Plan.

A copy of Congresswoman Capps speech on the Homeowner Affordability and Stability Plan follows:

One-Minute on Housing

March 4, 2009

Madame Speaker, by now we all know the central role the crisis in the housing market has played in our economic troubles.

The housing meltdown is devastating for families and communities

Particularly for the innocent families who lived within their means, paid their mortgages on time but through no fault of their own find their home values eroding and their life savings threatened.

This is why we must pass the Helping Families Save Their Homes Act.

This legislation restores fairness to the bankruptcy system by giving families who own one home the same rights as those who own two, three, or four.

Current law allows loan modifications for vacation homes and yachts, yet prohibits them for primary residences – this bill will end this inequity.

It fixes the Hope for Homeowners program to increase mortgage modifications and reduce foreclosures.

This bill is not about bailing out lenders or borrowers who made irresponsible decisions.

It’s about finding fair and effective solutions to stabilize the housing market.

Madame Speaker, our constituents are hurting.

Too many are losing their jobs and their homes

This legislation is necessary to help fix the housing market and get our economy back on track.

I urge my colleagues to support this bill.