Schumer Pushes for Expedited Passage of Senate's Housing Recovery Package; Calls for Bipartisan Support Similar to Economic Stimulus
Housing Stimulus Package Contains Much Needed Remedies to Address the Cause of the Economic Downturn and Keep Families from Losing their Homes Four Provisions Championed By Schumer are Included in Foreclosure Prevention Act of 2008
Washington , D.C. - U.S. Senator Charles E. Schumer today called on Congress to support the housing recovery package announced today by Senate Democrats, urging a bipartisan effort to bolster the faltering housing markets in the same way Congress swiftly tackled the economic stimulus package earlier this month. The housing stimulus package is designed to prop up the floundering housing market that has caused the current downturn in the economy and is expected to save one million families from foreclosure.
"This package is aimed at the bullseye of our economic crisis - the housing market. If we really want to tackle the economic problems the country is facing, we must address the housing crisis that got us here," Schumer said. "We need to apply the same bipartisan commitment to attacking the housing crisis that we had in putting together the economic stimulus package."
Senator Schumer has been pushing for a housing stimulus package for months following the collapse of the housing markets and the resulting economic downturn late last year. Four provisions that Schumer has championed will be included in the Foreclosure Prevention Act of 2008:
· Increase Funding for Foreclosure Prevention Counseling : Last year, Senator Schumer, Senator Bob Casey and Senator Sherrod Brown fought for additional funds for nonprofit foreclosure prevention counselors. Thanks to the efforts of Senator Patty Murray, they succeeded in inserting $180 million in funding for foreclosure prevention counseling in the omnibus signed by the President in January. Senator Schumer has since called for more funding to help counselors meet growing demand. An additional $200 million in funding for foreclosure prevention counseling, included in the Foreclosure Prevention Act of 2008 announced today, will assist as many as 500,000 additional families connect with their mortgage servicer or lender to explore options that will keep them in their homes.
· Raise the State Activity Bond Cap for Housing Project by $10 Billion : Earlier this month, Senator Schumer worked with Senator John Kerry to include a provision in the Senate Finance Committee version of the economic stimulus package allowing state governments to issue more taxexempt bonds to fund new construction of affordable single and multifamily housing units. The Foreclosure Prevention Act of 2008 would increase the state private activity bond cap by $10 billion, allowinghousing finance agencies to use proceeds from mortgage revenue bonds to refinance subprime loans, to provide mortgages for firsttime home buyers, and for multifamily rental housing.
· Increase Funding for Community Development Block Grants by $4 Billion: Homes that have been foreclosed and are sitting unoccupied on the market can sap neighboring homes of their value. This provision, introduced by Senator Chris Dodd, allows localities with the highest foreclosure numbers and rates access CDBG funds to use toward purchasing these properties, rehabilitate them if necessary and rent or resell them. Senator Schumer has pushed to double CDBG funding to help communities fight a wide range of development needs, including fighting the growing problem of vacant housing in Upstate New York.
· Modify the Bankruptcy Case to Allow Modifications of Mortgages : The Foreclosure Prevention Act of 2008 includes a measure sponsored by Senator Richard Durbin that would change the bankruptcy code to allow judges to modify the mortgage of the debtor. Senator Schumer is a cosponsor of the Durbin bill. This provision could help more than 600,000 financiallytroubled families keep their homes by allowing them to modify their mortgages in bankruptcy. It eliminates a provision of the bankruptcy law that prohibits modifications to mortgage loans on the debtor's principal residence for homeowners who meet strict income and expense criteria. With this change, primary mortgages are treated the same as vacation homes and family farms.