Reps. Mike Thompson, Zoe Lofgren, Anna Eshoo Call on Obama Administration to Address Housing Crisis

Urge President Appoint Director of Federal Housing Finance Agency

Washington, DC – January 12, 2012 – (RealEstateRama) — Representatives Mike Thompson (CA-1), Zoe Lofgren (CA-16) and Anna Eshoo (CA-14) led a group of 25 California Members of Congress in calling on President Barack Obama to address the housing crisis and appoint a Director of the Federal Housing Finance Agency (FHFA). The FHFA, which oversees mortgage backers Fannie Mae and Freddie Mac, has been without a permanent director for two and a half years.

“For far too long, partisan politics in the Senate have prevented the FHFA from having a permanent Director who can effectively address our nation’s housing crisis,” said Thompson. “Families are living paycheck to paycheck, struggling to keep roofs over their heads. Doing nothing is not an option. We need an FHFA Director who is willing to help Americans get out of this housing nightmare.”

Representative Lofgren said, “Republicans in the Senate have been playing games with the American people by blocking the Federal Housing Financial Authority from having a proper leader. These are difficult times and we need to be doing everything we can to prevent foreclosures and keep families in their homes. I urge President Obama to take immediate action and appoint a permanent director.”

“Our national economy cannot fully rebound unless and until housing is addressed. The current situation of foreclosures is unacceptable,” said Eshoo. “That’s why President Obama should appoint a permanent Director of the Federal Housing Finance Agency immediately.”

In California, more than 2 million homeowners are considered “underwater” because they owe more on their homes than their homes are worth, which equals 30 percent of all California homes with mortgages.

In a letter to President Obama, Thompson, Lofgren, Eshoo and other California Members of Congress wrote, “The FHFA regulates and oversees Fannie Mae and Freddie Mac, which together hold 70 percent of mortgages in the US. The current economic crisis began in the housing market and our economic recovery is dependent on the important work pending before the FHFA. It is time to move forward and put in place a permanent FHFA Director.”

The full text of the letter is below.

The President
The White House
Washington, DC 20500

Dear President Obama:

We urge you to act on behalf of the American people and immediately make an appointment for the Director of the Federal Housing Financial Agency (FHFA). For two and a half years, Senate Republicans have been blocking the appointment of this position, causing there to be no permanent Director. The FHFA regulates and oversees Fannie Mae and Freddie Mac, which together hold 70% of mortgages in the US. The current economic crisis began in the housing market and our economic recovery is dependent on the important work pending before the FHFA. It is time to move forward and put in place a permanent FHFA Director.

According to RealtyTrac, 224,394 U.S. properties had foreclosure filings in November, 2011. This means that 1 in every 579 housing units received a foreclosure filing nationwide. In California, 1 in every 211 housing units received a foreclosure filing. And there are fears that a new set of foreclosure waves may come in the next few months. According to RealtyTrac cofounder, James Saccacio, “November’s numbers suggest a new set of incoming foreclosure waves, many of which may roll into the market as REOs or short sales sometime early next year…some bellwether states such as California, Arizona and Massachusetts actually posted year-over-year increases in foreclosure activity in November.”

It is clear that we must take immediate steps to prevent more foreclosures. As part of the FHFA’s ability to promote policies that will prevent foreclosures, they have the authority to establish rules over residential mortgages that Fannie Mae, Freddie Mac and other government enterprises are able to underwrite. FHFA has consistently and erroneously interpreted its mandate far too narrowly and as such has failed to take adequate action to help homeowners and has brought an end to successful, local initiatives—such as the PACE (Property Assessed Clean Energy) program. The PACE program allows property owners to finance energy efficiency measures and renewable energy projects for their homes and commercial buildings, thereby reducing their energy costs and making them better able to make mortgage payments. It has been successful in many of our districts, however, in July of 2009 FHFA issued a decision that essentially put an end to PACE programs across this country.

As the fiduciary of government-backed entities, there are steps that the FHFA can take to help prevent future foreclosures while also protecting taxpayers. Installing a permanent Director of the FHFA will allow the FHFA to move forward to make key decisions that will help keep families in their homes and improve our economy. We appreciate your recent appointment of Richard Cordray as the new Director of the United States Consumer Financial Protection Bureau over similar Republican opposition and we urge that you take the same action to put in place a permanent Director to the FHFA.

Sincerely,

Congressman Mike Thompson is proud to represent California’s 1st Congressional District, which includes the Counties of Del Norte, Humboldt, Lake, Mendocino, Sonoma, Napa, and Yolo. He is a senior member of the House Ways and Means Committee and the House Permanent Select Committee on Intelligence. Rep. Thompson is also a member of the fiscally conservative Blue Dog Coalition and sits on the bipartisan, bicameral Congressional Wine Caucus.