Rep. Courtney, House Send Comprehensive Housing Recovery Bill to Senate

Press Release

Congressman Joe Courtney voted in favor of a comprehensive housing reform bill that serves as an aggressive response to the national mortgage crisis to date. The main goal of H.R. 3221, the American Housing Rescue & Foreclosure Prevention Act, is to keep families facing foreclosure in their homes and to help communities recover and redevelop areas hardest hit by large numbers of foreclosed homes. The more than $15 billion for tax incentives, housing assistance and Community Development Block Grants is completely offset. The bill passed by a final vote of 272-152.

"At town hall meetings all over the district and in meetings with business leaders involved in the real estate market and home building industry, it is clear to me that this measure is critical to the future of eastern Connecticut's economy," Courtney stated. "Stopping the bleeding of foreclosures will help stabilize real estate values and giving a tax credit for first time home buyers will provide a necessary spark for the market. The weakness in this sector is a threat to our towns and middle-class families, and will go a long way to restoring credit and confidence in our economy."

The comprehensive housing legislation includes important provisions that will help prevent similar mortgage crises in the future and to mitigate the current crisis:

* FHA Housing Stabilization and Homeownership Retention Act: Predicted to help 400,000 families stay in their homes
* Strengthening Regulations of the GSEs
* Backstopping Fannie Mae and Freddie Mac To Shore Up the Housing Market
* Stabilizing Neighborhoods Hurt by the Foreclosure Crisis: Includes nearly $4 billion in Community Development Block Grant funding
* Preventing Future Abuses and Crises
* FHA Modernization
* Preserving the American Dream for Our Nation's Veterans
* Tax Provisions to Expand Refinancing Opportunities and Spur Home Buying (H.R. 5720)

The most significant change to H.R. 3221 included in today's measure, not included when the House last passed the bill in May, is the authority for the Treasury to financially back both Fannie Mae and Freddie Mac, as requested by the Administration's Secretary of Treasury, Henry Paulson, on July 13th. H.R. 3221 would permit the Treasury Department to purchase stock in the two Government Sponsored Enterprises in order to secure confidence in the markets. The two GSEs own or insure $5 trillion of the $12 trillion in mortgages nationwide. However, both the Treasury and the Congressional Budget Office predict that it will not be necessary to take these steps.

Click here to download the detailed provisions of H.R. 3221, the American Housing Rescue & Foreclosure Prevention Act.

According to various sources, foreclosures and delinquencies combined have almost doubled in Connecticut over the last year and a half, with 14,931 in the 1st Quarter of 2008.

Windham County has been hardest hit by the recent wave of foreclosures in Connecticut, with 23 foreclosure-related filings for every 1,000 households, compared with 17 in the state as a whole.

The Town of Plainfield holds the highest foreclosure rate in the state at 3.5 percent, or 35 homes out of every 1,000. Enfield, Norwich, Vernon, Colchester, New London have the most homes in foreclosure in the 2nd District, overall.

According to a Hartford Courant report, the State of Connecticut has 77,000 active subprime mortgages totaling about $17 billion. Of those, about 15 percent — or 11,550 loans totaling $2.5 billion — were seriously delinquent and headed for foreclosure as of Dec. 31.

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