WASHINGTON, DC – Congresswoman Carolyn B. Maloney (D-NY), Chair of the House Financial Services Subcommittee on Financial Institutions and Consumer Credit Subcommittee, issued the following statement today after the House passed The American Housing Rescue and Foreclosure Prevention Act of 2008 (H.R. 3221).  The bipartisan bill will assist homeowners facing foreclosure, and help strengthen the housing market and overall economy.  It could become law as early as this week. 

“Over the last few years, we have seen a tsunami of mortgage defaults and foreclosures across our country.  More than one million people have lost their homes, and our financial markets are in turmoil. 

“There are no easy answers to our current economic problems, but one thing is clear: we must address the root of our weakening economy – the housing crisis.  We must keep families facing foreclosure in their homes and help other families avoid foreclosures in the future.  That’s what this critically important bill does.  I was proud to support it, and I applaud Chairman Frank for his leadership on the issue. 

“The Foreclosure Prevention Act will provide much-needed relief to struggling homeowners, certainty to our markets, and stability to our communities and economy.

“The bill will also create a strong, independent regulator of Fannie Mae and Freddie Mac that will have real teeth, responsibility, and power.  This will ensure the GSEs can safely and soundly provide our nation’s families with affordable housing.  The bill also provides an important backstop for Fannie and Freddie to help shore up the housing market.

“Importantly for my district and other high-cost areas around the country, H.R. 3221 will permanently raise GSE loan limits from $417,000 to as much as $625,000.  The bill also creates a new permanent affordable housing trust fund – financed by the GSEs and not by taxpayers – to fund the construction, maintenance, and preservation of affordable rental housing for low and very low-income individuals and families nationwide in both rural and urban areas.

“The Foreclosure Prevention Act not only addresses the current housing crisis, but it also seeks to prevent future crises.  The bill will establish a national loan originator licensing and registration system that will set minimum standards for loan originator licensing.  It will also substantially improve the oversight of mortgage brokers and bank loan officers, and establish improved mortgage disclosure requirements to ensure that mortgage borrowers understand the terms of their loans.”

“While we are not out of the woods just yet, this bill is a huge step forward.  The Democratic Congress remains committed to doing everything we can to keep the housing crisis from getting worse, and to bringing greater oversight to our nation’s financial institutions.”

The American Housing Rescue and Foreclosure Prevention Act of 2008 (H.R. 3221) would, among other things:

* Help significant numbers of hardworking American families in danger of losing their homes refinance into lower-cost government-insured mortgages they can afford to repay – at no cost to taxpayers;

* Strengthen neighborhoods hardest hit by the foreclosure crisis by providing resources that would help cities and states buy up and rehabilitate foreclosed properties that are currently driving down home prices, reducing state and local revenues, and destabilizing neighborhoods;

* Put a tough, independent new regulator in charge of the housing Government Sponsored Enterprises, or GSEs (Fannie Mae and Freddie Mac);

* Give the Treasury Secretary the authority to increase the already existing line of credit to Freddie and Fannie for the next 18 months, and give the Treasury Department standby authority to buy stock in those companies to provide confidence in the GSEs and stabilize housing finance markets;

* Establish a nationwide loan originator licensing and registration system that will set minimum standards for loan originator licensing, substantially improving the oversight of mortgage brokers and bank loan officers, as well as improved mortgage disclosure requirements that will help ensure that mortgage borrowers understand their mortgage loan terms;

* Expand homeownership opportunities for veterans and help returning servicemen and women avoid foreclosure and stay in their homes; and

* Provide tax incentives to spur home buying.

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