Sens. Chris Dodd, D-Conn., and Richard Shelby, R-Ala., chairman and ranking member, respectively, of the Senate Committee on Banking, Housing and Urban Affairs, have completed bipartisan legislation that includes major efforts to address the housing crisis. According to the senators, by providing relief to hundreds of thousands of American homeowners and introducing broad improvements to the nation's housing system, the legislation will help to contain the current problems in the housing markets.
The comprehensive housing legislation contains provisions from a Dodd-Shelby bill that was approved by the Committee on May 20, as well as measures from the Foreclosure Prevention Act, which passed the Senate in April. The legislation to be considered contains the following provisions:
- The HOPE for Homeowners Act: creates an initiative within the Federal Housing Administration (FHA) to prevent foreclosures for hundreds of thousands of families at no estimated cost to American taxpayers;
- Affordable Housing Fund: a permanent, new fund that will help create more affordable housing for millions for Americans in communities across the country;
- Assistance for Communities Devastated by Foreclosures: to ensure that communities can mitigate the harmful effects of foreclosures, $3.92 billion in supplemental Community Development Block Grant Funds will be provided to communities hardest hit by foreclosures and delinquencies;
- Foreclosure Counseling for Families in Need: to help families avoid foreclosure, the bill provides $150 million in additional funding for housing counseling;
- Preserving the American Dream for Our Nation's Veterans: This bill contains several provisions to help returning soldiers avoid foreclosure, including lengthening the time a lender must wait before starting foreclosure from three months to nine months after a soldier returns from service;
- GSE Reform: creates a world-class regulator for the government-sponsored enterprises (GSEs) so that these vital institutions can safely and soundly carry out their important mission of providing our nation's families with affordable housing;
- FHA Modernization: A provision to modernize, streamline and expand the reach of the FHA, allowing families in all areas of the country to access secure and affordable mortgages through the FHA; and the
- Enhancing Mortgage Disclosure: to ensure that consumers know the exact amounts of their mortgage payments, including the maximum possible payment under the terms of the loan and changes in payments associated with adjustable-rate mortgages, lenders will be required to provide borrowers with timely and meaningful mortgage disclosures on all home purchase loans, loans that refinance a home, and loans that provide a home equity line of credit.
Source: Senate Banking Committee on Banking, Housing and Urban Affairs
