Programs She Created, Advocated for Under Attack
Washington, DC – March 17, 2011 – (RealEstateRama) — The House of Representatives voted today to end the Neighborhood Stabilization Program (NSP), which Congresswoman Maxine Waters (D-Calif.) created and which President George W. Bush signed into law three years ago under the Housing and Economic Recovery Act (HERA). Last week, House Republicans also voted to end the Federal Housing Administration (FHA) Short Refinance Program and the Emergency Homeowners Relief Program (EHRP), the latter of which Congresswoman Waters worked to include in the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010.
“I just have one question for my colleagues on the opposite side of the aisle,” said Congresswoman Waters. “Whose side are you on? Are you on the side of homeowners facing foreclosure and dealing with unemployment, and communities devastated by boarded-up, rat-infested, abandoned homes that are driving down property values? I want to know, because their votes plainly demonstrate that they are not on the side of homeowners and communities. Republicans – just like Democrats – are hearing from constituents and communities that are really struggling, and yet they choose to kill these programs with no alternatives. It’s upsetting and it’s astonishing.”
NSP allows municipalities to access funds to clean up blighted homes and rundown communities devastated by the foreclosure crisis. Foreclosed properties drag down neighboring property values, and drive up costs for municipal governments. A small investment with NSP funds upfront can prevent exorbitant costs for local governments down the line. NSP, after receiving $4 billion in 2008 and an additional $2 billion under the 2009 Stimulus, received an additional $1 billion under Dodd-Frank.
“NSP creates jobs by bringing together contractors, subcontractors, painters, landscapers, and real estate professionals. The Republican NSP Termination Act will kill 93,000 jobs,” said Congresswoman Waters. “According to HUD, NSP has helped clean up 100,000 homes in the hardest-hit areas. Repealing it would make the funds inaccessible for the foreclosures that we know are coming. The Republicans aren’t dealing in reality when it comes to this program because they are driven by their own ideology, not NSP’s performance.”
WATCH CONGRESSWOMAN WATERS DEFEND NSP HERE
Under the FHA Short Refinance Program, investors agree to write down at least 10 percent on the borrower’s mortgage. In exchange, the borrower is refinanced into an FHA loan. Borrowers must be current on their mortgage, and federal funds are only spent in the event of a borrower default. The program is an important option to have available for borrowers and numerous institutions, including Wells Fargo and GMAC/Ally, have recently agreed to participate in the program. Last week, the House passed Congresswoman Waters’ amendment to instruct the Department of Housing and Urban Development to place notices on its website, informing homeowners that the program has been cancelled, and that inquiring individuals should contact their Member of Congress for further information.
Under the FHA Short Refinance Program, investors agree to write down at least 10 percent on the borrower’s mortgage. In exchange, the borrower is refinanced into an FHA loan. Borrowers must be current on their mortgage, and federal funds are only spent in the event of a borrower default. The program is an important option to have available for borrowers and numerous institutions, including Wells Fargo and GMAC/Ally, have recently agreed to participate in the program. Last week, the House passed Congresswoman Waters’ amendment to instruct the Department of Housing and Urban Development to place notices on its website, informing homeowners that the program has been cancelled, and that inquiring individuals should contact their Member of Congress for further information.
EHRP would provide low-cost loans to unemployed homeowners to help them pay their mortgage. It is based on a highly successful program in Pennsylvania, which has helped 42,700 people since 1983.
“Republicans pulled the rug out from under these programs before they could even get up and running,” said the Congresswoman. “They don’t care that lenders are willing to participate in FHA Short Refinance, or that the Pennsylvania loan program for unemployed homeowners has helped tens of thousands of people.”
On March 29th, the House is expected to take up the Home Affordable Modification Program (HAMP) Termination Act. HAMP is the Obama Administration’s program to help homeowners achieve loan modifications and stay in their homes. “Terminating HAMP without a credible and stronger alternative would be contrary to our goal of helping homeowners stay in their homes, despite some of the programs flaws. I will not vote to terminate HAMP because my Republican colleagues are not prepared to offer an alternative. Instead, I will vote to preserve HAMP, while continuing to fight for stronger rules and better enforcement,” said Congresswoman Waters.
“I have already begun communicating with key Senators, asking them to ensure that these bills are defeated or that they are not taken up all together.”
Contact:
Sean Bartlett (202) 225-2201
