New “Keep Your Home California” Program is designed to provide relief to tens of thousands of Californians

MARTINEZ, CALIFORNIA—Rep. George Miller (D-Martinez) today called on the California Housing Finance Agency (CalHFA) to provide “real assistance to California homeowners” when it debuts its new Keep Your Home California program next month.

Rep. Miller and other members of the California congressional delegation wrote CalHFA Executive Director Steven Spears to request a meeting to discuss how CalHFA will avoid problems that have plagued state, federal, and private efforts to help homeowners, including major banks’ ongoing unwillingness to work constructively with borrowers to achieve more affordable monthly payments.

CalHFA’s proposal for the Keep Your Home California program suggests that the program will be able to assist 40,000 or more homeowners in California. Rep. Miller said that California will receive nearly $2 billion to help California homeowners through the program.

“For over two years, homeowners in our community have been hurt by the financial crisis that began with greed on Wall Street and a blind eye from their Washington allies who recklessly enacted a deregulatory agenda,” said Rep. Miller. “It’s clear from the continued high rate of foreclosures and the recent scandal with mishandling of foreclosures that current efforts to help are inadequate. CalHFA has a big opportunity coming up to help our residents. That’s why my colleagues and I are asking CalHFA to ensure that the program will quickly and effectively provide badly-needed relief to my constituents throughout Contra Costa and Solano, and to other residents in the state.”

The Keep Your Home California program has received funding through the U.S. Treasury Department’s Hardest Hit Fund program, which provides funds to state housing agencies in states that have been hit particularly hard by the housing crisis. Rep. Miller has helped ensure that a fair share of Hardest Hit funds were provided to California, which is home to 7 of the 10 metro areas with the highest foreclosure rates in the country. CalHFA has outlined a program that includes principal reduction, bridge loans for unemployed homeowners, mortgage reinstatement assistance for delinquent homeowners, and transition assistance for struggling homeowners moving to new housing.

“I will not rest until my constituents are back on their feet,” said Rep. Miller. “I’m committed to working with CalHFA to ensure that this program accomplishes all that it has set out to achieve. It’s especially important that the Keep Your Home California program works for communities like those in the East Bay that are most in need of assistance. Hopefully, working together, we can help tens of thousands of Californians stay in their homes. But this is just one step—I’m going to keep working on innovative ways to help struggling homeowners in my district, and to help small businesses in our community to create jobs, since a growing economy is the best way to help homeowners and move our community forward.”

More information on the Keep Your Home California Program can be found at http://www.keepyourhomecalifornia.com/.

The following Members of Congress have also signed on to the letter to CalHFA: Loretta Sanchez (CA-47), Jerry McNerney (CA-11), Jim Costa (CA-20), Joe Baca (CA-43), Xavier Becerra (CA-31), Howard Berman (CA-28), Lois Capps (CA-23), Dennis Cardoza (CA-18), Judy Chu (CA-32), Susan Davis (CA-53), Anna Eshoo (CA-14), Bob Filner (CA-51), John Garamendi (CA-10), Jane Harman (CA-36), Mike Honda (CA-15), Barbara Lee (CA-09), Zoe Lofgren (CA-16), Doris Matsui (CA-05), Laura Richardson (CA-37), Lucille Roybal-Allard (CA-34), Linda Sanchez (CA-39), Adam Schiff (CA-29), Jackie Speier (CA-12), Pete Stark (CA-13), Mike Thompson (CA-01), Henry Waxman (CA-30), and Lynn Woolsey (CA-06).

The text of the California delegation’s letter follows below.

Mr. L. Steven Spears
Executive Director, California Housing Finance Agency
500 Capitol Mall, Ste. 1400
Sacramento, CA 95814

Dear Mr. Spears:

As you know, your agency will be the recipient of substantial federal assistance to help California communities hardest hit by the home foreclosure crisis. We are writing you regarding the upcoming start of your agency’s Keep Your Home California Program and specifically to request a briefing from your agency about how exactly you intend to carry out this important program and ensure its success. We also are offering to work with you in any way that would help ensure this program is able to get off the ground successfully and provide real assistance to California homeowners.

As you know, existing programs designed to help homeowners have been plagued by problems including lender and servicer unwillingness to work constructively with borrowers to modify mortgages to achieve more affordable monthly payments. In fact, many of us recently wrote to Attorney General Eric Holder, Federal Reserve Chairman Ben Bernanke, and Comptroller of the Currency John Walsh asking that they investigate possible violations of the law by financial institutions in their mishandling of mortgages (letter attached).

It is, of course, critical that we avoid these sorts of problems as the Keep Your Home California Program begins operating. Indeed, your proposal for the program for funding through the first round of the Hardest Hit Fund grant program indicated that you could help nearly 40,000 California homeowners through principal reduction, bridge loans for unemployed homeowners, mortgage reinstatement assistance for delinquent homeowners, and transition assistance for struggling homeowners moving to new housing. Two subsequent rounds of funding should mean that the program can help an appreciably higher number of homeowners in California than that initial estimate.

Like you, we are fully dedicated to helping California homeowners get back on their feet. We simply cannot afford to miss this opportunity to help tens of thousands of Californians. Furthermore, it is critical that this program begin helping homeowners as expeditiously as possible, given that many of our constituents have been struggling for over two years through the ongoing difficulties in the job and housing markets. For this reason, we are asking you to schedule a meeting at your earliest convenience to brief our respective California staff on your plans to implement the Keep Your Home California Program and to ensure that it is not plagued by the same types of paperwork difficulties and lender and servicer intransigence that have hindered other efforts to resolve the foreclosure crisis.

Thank you in advance for your consideration of this request and for your work on behalf of California homeowners.