Washington, DC – U.S. Representative Judy Biggert (R-IL-13) today urged Federal Housing Administration (FHA) Commissioner Brian Montgomery to act quickly to aid struggling homeowners by expanding eligibility for the FHASecure program.  Joined by Shelley Moore Capito (R-WV-02), Biggert sent a letter to the Commissioner calling for improvements to the program that would allow it serve up to 200,000 additional homeowners facing foreclosure.
 
            “High foreclosure rates continue to damage our economy, degrade home values, and displace families,” said Biggert, Ranking Member of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit.  “FHASecure already has helped 130,000 qualified homeowners to refinance into much safer, more secure FHA loans.  It’s a common-sense way that we can give struggling borrowers an alternative to bad, subprime loans -- without resorting to an inappropriate taxpayer-funded bailout.”
 
            Launched in September 2007, FHASecure is designed to help homeowners struggling because of a rate change on their adjustable rate mortgages (ARMs).  Homeowners with solid payment histories before their initial teaser rate changed are given the opportunity to refinance to a lower-cost, FHA-insured loan.
 
            “The housing crunch has had a ripple effect on our economy that demands a concerted effort to combat foreclosure, protect home values, and provide support for struggling families,” said Capito, Ranking Member of the Housing and Community Opportunity Subcommittee. “The well-documented success of FHASecure presents an opportunity to provide a self-sustaining line of support for homeowners without shouldering taxpayers with undue risk or jeopardizing consumer access to credit.”
 
            The FHA administers the only Federal housing insurance program that provides mortgage alternatives for many low- and middle-income Americans, including first-time homebuyers and those currently looking to refinance.
 
            The full text of the letter can be found below:
 
April 8, 2008
 
The Honorable Brian Montgomery
Federal Housing Administration
451 7th Street, S.W.
Washington, D.C. 20410
 
Dear Commissioner Montgomery:
 
We are pleased to learn of recent reports that your agency may have the ability to assist, by the end of 2008, up to 200,000 additional qualified homeowners facing foreclosure to refinance their bad, subprime loans into to safe, FHA-insured products by expanding the FHASecure program.  While Congress puts the finishing touches on FHA modernization legislation, we urge you to finalize details of your proposal and administratively expand FHASecure as soon as possible. 
 
As you know, foreclosures are on the rise and the more qualified homeowners that we can help keep in their homes the better.  We think it’s wise to help troubled homeowners refinance through FHA.  It’s a way the government can help without spending taxpayer dollars on an inappropriate bailout.
 
We appreciate your and the Administration’s efforts to date, and we look forward to seeing your new initiative implemented as soon as possible.  Please feel free to contact us if we can provide any Congressional assistance to achieve this end.
 
Sincerely,
 
Judy Biggert (R-IL), Ranking Member, House Financial Services Subcommittee on Financial Institutions and Consumer Credit
 
Shelley Moore Capito (R-WV), Ranking Member, House Financial Services Subcommittee on Housing and Community Opportunity