Issue Position: Housing

Issue Position

I have talked with families who have lost their homes to foreclosure and seen the consequences throughout our neighborhoods. While our local real estate market has improved considerably since the foreclosure crisis began, the statistics in our area remain deeply troubling. As of February 2013, foreclosures in Michigan have stabilized and have been steadily decreasing over the past year. The foreclosure rate in the 9th Congressional District has declined to 1.42% - a nearly 40% decrease from the previous year. Additionally, the mortgage delinquency rate, a strong indicator of future foreclosures, has decreased to 5.05% representing a near 25% decrease from the previous year. Moreover, the delinquency and foreclosure rates in our congressional district and Michigan state are lower than the national average.

If you or someone you know is facing foreclosure or worried about your ability to make your mortgage payments, you should always contact your loan servicer to discuss your situation. You can also contact a HUD-approved housing counselor by calling 1-888-995-HOPE. To see a list of HUD-approved housing counselors in Macomb and Oakland Counties, click here. Call my office at 586-498-7122 for assistance working through these channels. Please don't wait. Addressing the foreclosure crisis that is devastating our neighborhoods goes hand-in-hand with restoring stability to the financial system and jumpstarting our economy.

The Obama Administration and Congress have taken a number of steps to prevent foreclosures and revive the housing market. Each month, the Department of Treasury and Housing and Urban Development produce a "Housing Scorecard" that measures the progress that has been made in the housing market's recovery and outlines steps taken by the Administration to help homeowners. You can view this scorecard here. Earlier this year, the President outlined a number of additional steps the federal government should take to help homeowners and help repair the housing market. I support taking additional actions to accelerate our housing recovery, but unofrtunately Congress has not acted on these proposals.

Making Home Affordable

The Making Home Affordable program is part of the federal government's comprehensive strategy to get the housing market back on track.

Through the Making Home Affordable Program, up to 9 million American families may be eligible to refinance or modify their loans to a payment that is affordable now and into the future. To date, over 1.9 million homeowners have started a trial modification under the Home Affordable Modification program, and more than one million homeowners have received a permanent modification.

The Home Affordable Refinance program is designed to help homeowners with solid repayment histories but who are unable to refinance due to falling home values get into a mortgage with payments that are affordable today and sustainable for the life of the loan.

The Home Affordable Modification program is designed to help financially struggling homeowners, including those who have fallen behind on payments, avoid foreclosure by modifying loans to a level that is affordable now and sustainable over the long term. The program provides incentives to modify loans, as well as clear and consistent modification guidelines.

Visit www.makinghomeaffordable.gov for more information or click here for my office's fact sheet on Making Home Affordable.

Mortgage Reform

I believe that to avoid a repeat of this housing crisis, we must address the irresponsible, and in some cases predatory, lending practices that significantly contributed to the wave of foreclosures devastating our neighborhoods. On May 7th, the House of Representatives overwhelmingly approved the Mortgage Reform and Anti-Predatory Lending Act . Most basically, this bill says that you can't write a mortgage that a consumer cannot reasonably afford to repay, and you can't steer them from an affordable mortgage to an unaffordable one. The provisions of this bill became law as part of the Dodd-Frank financial services regulatory overhaul enacted in June 2010.

Neighborhood Stabilization Program

I believe it's also critical that even as we work to prevent foreclosures, we help our communities cope with those that have already occurred. Foreclosed properties lower surrounding property values and are a drain on already stretched local budgets. The Housing bill enacted in 2009 provided $3.92 billion in "Neighborhood Stabilization Program" or "NSP" funds for state and local governments to purchase and redevelop abandoned and foreclosed homes and residential properties. The Department of Housing and Urban Development (HUD) allocated a total of $263.6 million to Michigan, the third largest total nationwide behind Florida and California. Local communities are beginning implementation of the program now.

The American Recovery and Reinvestment Act provided an additional $2 billion to be distributed to state and local governments on a competitive basis. These additional grants were awarded based on communities' capacity to execute projects, potential to leverage grant dollars, and concentration of investment to achieve neighborhood stabilization. The Dodd-Frank financial services regulatory overhaul included an additional $1 billion in formula funding. Overall, 12th District communities received nearly $50 million in funding across all three rounds of NSP.

Source