Senate Democrats

Senate Democrats Discuss Efforts To Address Nation’s Subprime Housing Crisis

Washington, DC—Senate Democrats held a press conference today to discuss the nation’s growing subprime mortgage and foreclosure crisis and their efforts to address it.  As new evidence emerges every day of the severity of these housing emergencies, Democrats are working to help deserving families weather this storm.

“The FHA Modernization Act of 2007 bill makes safe, long-term FHA loans more readily available to the families that might have been suckered into exotic loans with teaser rates, or to first-time, lower-income homebuyers,” said Senate Majority Leader Harry Reid.  “These borrowers need better mortgage options and FHA loans will be a better option with this legislation.  We have secured $200 million in the Transportation HUD appropriations conference report for foreclosure-prevention counseling, but the President has threatened to veto this legislation.  We urge him not to do this at a time when foreclosure counseling is needed most.”

Said Senator Dick Durbin: “Millions of Americans need our help to ensure their dream of owning a home.  Congress must take action now to keep people in their homes and to maintain property values in at-risk neighborhoods. If we don’t act, these numbers show that an already bad situation could become catastrophic for homeowners and communities across the country.”

“This Administration needs to take off its ideological handcuffs when it comes to helping homeowners and protecting our economy,” Senator Chuck Schumer said.  “These bills are a measured, targeted effort to prevent the spread of the subprime mortgage meltdown to more families and into the larger economy – and they should be supported by my colleagues and by the White House.”

Said Senator Patty Murray: “With stagnant wages, tightening credit, and little to no home equity built up, homeowners facing foreclosure find themselves with very few options to get back on track.  These homeowners need help.  As Chair of the Transportation and Housing and Urban Development Subcommittee, I am proud that we are addressing the crisis of housing in America head on. Our conference report – which passed the House yesterday – includes $200 million in spending housing counseling to help keep struggling mortgage holders in their homes.  Making the dream of homeownership a reality is simply the right thing to do.”

“I am deeply concerned that financial regulators were unprepared and ill-equipped to deal with the boom in subprime lending and securitization and they still don’t have a strong grip on the situation.  And with more risky loans resetting next year this situation is only going to get worse,” said Senator Jack Reed, a member of the Banking Committee.  “Helping people stay in their homes is good policy and it is the right thing to do.  We need to work together – Congress, the Administration, regulators, the industry– towards the goal of keeping American families in their homes and reforming the system so this never happens again.”

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