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Pascrell Applauds Signing of American Housing Rescue and Foreclosure Act

Press Release

Location: Washington, DC


U.S. Rep. Bill Pascrell, Jr. (D-NJ-08) a member of the House Committee on Ways and Means and the author of legislation to create a new homebuyer tax credit today applauded the signing of the American Housing Rescue and Foreclosure Protection Act.

"New Jersey communities have been hit particularly hard by the mortgage crisis," stated Pascrell. "With the enactment of this legislation millions of families who are struggling through the foreclosure process will stand a better chance of keeping their homes and helping the American economy recover."

Pascrell was particularly pleased with one provision that will provide first-time homebuyers with a refundable credit (equivalent to an interest-free loan) of ten percent of the purchase price of their home (up to $7,500). Taxpayers would be required to repay any amount received under this provision to the government over 15 years in equal installments. The credit is phased out for taxpayers with adjusted gross income in excess of $75,000 ($150,000 in the case of a joint return).

"Too many potential homebuyers who are qualified to own a home are sitting on the sidelines afraid to enter the housing market," stated Pascrell. "This first time homebuyer tax credit will motivate new homebuyers with a substantial incentive to purchase a house and jumpstart the economy."

In addition to providing tax credits for first time homebuyers, the legislation will help families keep their homes, aid local communities hit hard by the foreclosure crisis and strengthen the economy.

The American Housing Rescue and Foreclosure Prevention Act will allow American families in danger of losing their home to refinance into lower-cost government -insured mortgages they can afford to repay - at no cost to the American taxpayer. The legislation also:

* strengthens neighborhoods hardest hit by the foreclosure crisis by providing resources to allow cities and states to buy up and rehabilitate foreclosed properties that are currently driving down home prices, reducing state and local revenues, and destabilizing neighborhoods;
* expands homeownership opportunities for veterans and helps returning soldiers avoid foreclosure and stay in their home; and
* creates a new fund to boost the nation's stock of affordable rental housing in both rural and urban areas for low and very low-income individuals and families.

The legislation also includes provisions that will help restore confidence in financial markets and shore up Fannie Mae and Freddie Mac. The bill provides the Department of the Treasury with emergency and temporary financing authority for Fannie Mae and Freddie Mac. Fannie Mae and Freddie Mac are important institutions that hold or guarantee nearly half of all mortgages in the United States.

"The rapid decline of America's housing market has taken its toll on our economy. Foreclosures hurt us all. When a home forecloses, property values drop and entire neighborhoods suffer. That is why it is so critical for the federal government implement stronger safeguards. I am pleased that Congress approved this legislation and pushed the White House to sign the bill," concluded Pascrell.

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