Waters Wins Big for Homeowners in Wall St Reform and Consumer Protection Bill
The Wall Street Reform and Consumer Protection legislation passed by the House includes a number of provisions introduced and championed by Congresswoman Maxine Waters (D-CA) to help homeowners.
"Economic recovery requires solving the housing crisis and helping homeowners who have underwater mortgages and are at risk of foreclosure. Hard-working Americans who have lost their jobs through no fault of their own should not have to lose their homes as well," said Congresswoman Waters. "I am proud that this legislation includes my provisions to protect homeowners from fraud and foreclosure so they can stay in their homes and to stabilize neighborhoods."
Congresswoman Waters, who chairs the House Subcommittee on Housing and Community Opportunity, argued that this comprehensive restructuring of the nation's financial system must address the housing crisis. She worked to include provisions that help homeowners through increasing funds for the Neighborhood Stabilization Program and creating a program to help unemployed homeowners keep up with their mortgage payments; make loan modifications mandatory; and reign in attorneys engaged in loan modification scams.
Help for Unemployed Homeowners: While the first wave of foreclosures was driven by subprime and predatory loans, current foreclosures are increasingly being driven by unemployment. Congresswomen Waters has introduced a national program to assist unemployed homeowners by providing them low-interest loans to help them pay their mortgages. The program is based on a successful program that has helped many Pennsylvania homeowners avoid losing their homes. The financial regulatory reform bill will provide $1 billion for this purpose; an additional $1 billion for the program will be made available from unused TARP funds.
Neighborhood Stabilization Program: This program – created 2 years ago through Congresswoman Waters' efforts – enables local governments and non-profits to purchase and rehabilitate foreclosed and abandoned properties and sell those homes to low- and moderate-income buyers. NSP has made significant investments into communities nationwide, and the need for NSP funding is growing. The financial regulatory reform bill includes an additional $1 billion in funding for NSP.
Protect Homeowners from Scams: Congresswoman Waters worked with Americans for Financial Reform and the American Bar Association to include language in the final financial regulatory reform bill that would regulate attorneys providing financial services or products, such as loan modification and debt settlement services, to be regulated under the newly-created Consumer Financial Protection Bureau. Unscrupulous private loan modification companies are partnering with so-called "foreclosure consultants" to prey upon vulnerable homeowners promising to help save their homes from foreclosure. They either charge an excessive fee for services that can be obtained for free from a qualified nonprofit counseling agency, or they deliver little or nothing for the money received from a desperate homeowner. These businesses are able to charge steep upfront fees because certain attorneys lend their names to the businesses. Congresswoman Waters' efforts will help bring an end to these types of deceptive practices, by requiring all attorneys providing a financial service or product to be subject to the same CFPB registration and reporting standards as other non-depository financial service providers.
"This legislation has been designed to prevent another financial crisis, to reform how Wall Street and the nation's major financial institutions operate, and to protect American consumers from predatory loans, excessive bank charges and credit card fees. Families and small businesses on Main Street in cities and towns across the country will benefit from our efforts to hold Wall Street accountable," the Congresswoman said.
Congresswoman Waters served on the House-Senate conference committee that crafted the conference report by reconciling differences between House and Senate versions of the legislation. She negotiated with her colleagues in the House and Senate, among both Democrats and Republicans, to include these provisions and others in support of the following priorities:
The Wall Street Reform and Consumer Protection Act protects savings and investments of American families and small businesses by making the financial system more transparent and accountable, closing loopholes that big banks have exploited, and ending taxpayer-funded bailouts of Wall Street firms who made reckless decisions. To learn more about this legislation, click here.