July 24, 2008

House Passes Comprehensive Response to Mortgage Crisis

Many American families are struggling through the current mortgage and foreclosure crisis. In Washington State foreclosures were up 69 percent last month compared to just one year ago, an increase greater than the national average of 53 percent. Pierce County was hit particularly hard in the Puget Sound region, with one in 483 households in trouble.

This week, the House of Representatives took action and passed the most comprehensive response to the American mortgage crisis, H.R. 3221, the Foreclosure Prevention Act. This landmark bill will help families facing foreclosure keep their homes, help other families avoid foreclosures in the future, and help the economic recovery of communities harmed by empty homes caught in the foreclosure process. It harms all of the homeowners on a street where homes become vacant through foreclosure, so this bill has a broad impact on neighborhoods in our state as well as across the nation.

To restore market confidence, the bill gives Treasury emergency and temporary financing authority for Fannie Mae and Freddie Mac, which hold or back half of the national mortgage debt and are about the only source of money still available for mortgage lenders. Most Americans’ primary investment is their home—and home values have plummeted by a record 15% in the last year. Ending the foreclosure crisis is vital to the American economic recovery.

The legislation passed the House by a vote of 272 to 152 and will now move on to the Senate. The President has agreed to sign the legislation into law.

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