Letter to Barack Obama, President of the United States - Housing Crisis in Southern Nevada

Letter

Congresswoman Dina Titus of Nevada's Third District sent the following letter to President Obama today on the housing crisis in Southern Nevada. Titus has been writing to the President on a monthly basis to update him on the challenges facing people in District Three.

Below is the text of the letter.

April 12, 2010

The Honorable Barack Obama
President of the United States of America
1600 Pennsylvania Avenue
Washington, D.C. 20500

Dear President Obama,

Thank you for the work that your administration is doing to help Americans across the country stay in their homes. While it appears that many communities have stabilized, Southern Nevada remains "ground zero" of our national housing crisis and my congressional district is the worst of the worst. In January of this year, the national 90+ day delinquency rate was 8.66%; in Nevada, however, it was 19% and in the third congressional district it was 20.66%. In the fourth quarter of 2008, seven of the 50 worst zip codes in the country for foreclosures were in my Congressional District. We truly have the perfect storm of record unemployment coupled with a burst housing bubble.

Since beginning my term in Congress last January, I have been fighting to restore economic stability to Southern Nevada and help my constituents stay in their homes. The economic recession, which was created in part by the reckless economic policies of your predecessor, has severely hurt Southern Nevada. While other areas of the country have seen signs of economic recovery, Southern Nevada is likely to trail behind. My office was one of the first in the country to work directly with homeowners and lenders to negotiate a mortgage modification which would allow them to avoid foreclosure and stay in their homes. I have been focusing on helping families who want to stay in their homes and were responsible in the debt they took on; and I believe assistance programs should be directed toward helping these types of homeowners.

As you know, the First-Time Homebuyer Tax Credit is scheduled to expire at the end of this month. I have been very supportive of this credit for a number of reasons. It was estimated that last year, 46,624 first-time homebuyers took advantage of the credit in Nevada and purchased their first home. These families and individuals are taking important steps for long-term financial stability. It was also estimated that the multiplier effect of each home sale boosts the economy by $34,276. I remain very supportive of the tax credit because it allows real families to move into homes in Southern Nevada and hope it can be extended.

In the next few weeks the five states that qualified for the additional funding for the hardest hit housing markets will submit their proposals to the Department of the Treasury for implementation of these funds. As you know, Nevada has a maximum allocation of $102.8 million. If used effectively, these funds can provide much needed assistance to struggling homeowners in Southern Nevada. The most effective use of these funds would be for a principal reduction program to help homeowners who are underwater. I hope that are working with Secretary Timothy Geithner to implement program guidelines focused on principal reduction which will not only help homeowners but will also be quickly and effectively implemented by banks.

It is also imperative that your administration work with lenders to modify second liens. Many of my constituents who have second liens on their mortgages are finding it virtually impossible to modify their first loans due to the second lien. Some constituents have informed me that lenders refuse to even begin the modification process due to their second lien. While I understand that the "Making Home Affordable" program now includes incentives for servicers that modify second liens, I am concerned that similar to the modification element of HAMP, servicers will not participate unless the anticipated outcome will greatly benefit their bottom lines. I hope that we can find ways to work with these lenders to help more homeowners with second liens.

I look forward to working with you on these important issues.

Sincerely,

Dina Titus
Member of Congress

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