H.R. 384 TARP Reform and Accountability Act of 2009
As a Congress, we have experienced numerous disappointments with the TARP program's implementation, most notably the Treasury's refusal to use TARP funds for loan modifications and homeowner relief. The need to address the foreclosure crisis head on is why I lend my support to H.R. 384 and its requirements for foreclosure mitigation.
When we passed the first TARP bill last year, we intended for the Treasury to use its unprecedented authority to remove toxic assets and nonperforming loans from the marketplace, modify mortgages, and increase the availability of credit. To date, no TARP funds have been used or directed to systematic loan modification or increased lending.
Foreclosures are affecting homeowners, renters, and communities. Homelessness levels are rising as a result of renters who have dutifully paid rent on time being evicted from their homes because the owner is in foreclosure. Stopping foreclosures is key to reducing homelessness, helping the economy to recover, and rebuilding communities.
H.R. 384 has the components homeowners, mortgage servicers, and lenders need to effectively confront the foreclosure crisis. The bill provides from $40 to $100 billion for funding foreclosure mitigation. We may need a larger funding level for foreclosure mitigation, perhaps up to $70 billion; however, I appreciate the chairman's efforts to direct resources to this crisis.
The bill also provides several alternatives for foreclosure mitigation, such as a systematic mortgage modification program, whole loan purchasing, buy-down of second mortgages, reduction of costs in the Hope for Homeowners Program, and incentives and assistance to servicers to modify loans.
But most importantly, in the manager's amendment, the bill will now require implementation of the systematic foreclosure prevention and mortgage modification program that I've been calling for since last year. On the first day of the 111th Congress, I introduced H.R. 37, the Systematic Foreclosure Prevention and Mortgage Modification Act of 2009, to give the power of law to the successful systematic mortgage modification program developed by the Federal Deposit Insurance Corporation and currently in use at the IndyMac Federal Bank, where it has resulted in over 5,000 IndyMac borrowers avoiding foreclosures. I applaud Chairman Frank for including this legislation in H.R. 384.
The housing crisis must be corrected through our efforts with TARP. I believe that H.R. 384 will finally put us on track to addressing the foreclosure crisis. I support H.R. 384, the TARP Reform and Accountability Act of 2009, and I urge my colleagues to vote "yes."
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