You are here

No GOP Housing Plan, Just Weakening the Middle Class

The Republican answer to jobs has been a 'So Be It' spending bill that would cost 700,000 jobs and stall our economic growth. On March 29th, Republicans continued to put partisan politics ahead of Americans' top priority - jobs.  Republicans passed the HAMP Termination Act (H.R. 839) by a vote of 252-170 which will cut off a lifeline to struggling, middle class homeowners. This is on top of recent legislation pulling the rug from under struggling homeowners, abandoning communities, and worsening the impact of foreclosure crisis.

Republicans have no real plan to strengthen the housing market, which is crucial to our economic recovery - leaving solutions in the hands of the lending industry.

Bill Information
H.R. 839, to eliminate new mortgage loan modifications under the Home Affordable Modification Program (HAMP), denying help to many homeowners at risk of losing their homes.  While this program has not helped enough homeowners, the Republican answer is to prevent any assistance to homeowners, even if providing that assistance speeds up the recovery in the housing sector and our economy.

  • This bill does not yield significant savings for taxpayers.  The Home Affordable Modification Program is funded by the Troubled Assets Relief Program and, by law, any shortfall in TARP must ultimately be paid for by the financial industry “in order to ensure that the Troubled Asset Relief Program does not add to the deficit or national debt.”
  • Turning over the resolution of the foreclosure crisis to the same lending industry that has prevented the HAMP program from being more successful would only result in the worsening of the foreclosure crisis, dampened home prices, and economic instability.
  • The program provides a typical borrower with a $500 reduction in monthly mortgage payments, and has helped more than 600,000 families with permanently lower mortgage payments.

The Obama Administration has issued a veto threat on this bill, the National Association of Counties supports the program, and a broad range of housing groups, and consumer and civil rights organizations - such as the Center for Responsible Lending, NAACP, and Americans for Financial Reform - oppose the bill. [3/15, 3/22, 3/3]

The housing market remains a drag on the economy, even as we are creating jobs and beginning to recover. 'The number one reason for nervousness about the economy in the next six to nine months is the foreclosure crisis,' according to Moody's economist Mark Zandi. [Ezra Klein,3/8/11]

Seven million families have lost their homes to foreclosure since the housing bubble burst, and another three million are expected to lose their homes in the next year, with nearly 14 million Americans out of work through no fault of their own.

Other anti-housing bills Republicans have passed include:

  • H.R. 830, abolishing help for families who are underwater to refinance into lower-cost mortgages they can afford to repay.
  • H.R. 836, eliminating short-term loans for up to 33,000 homeowners who lost their jobs through no fault of their own and are at risk of losing their homes. 
  • H.R. 861, eliminating efforts to strengthen hard hit neighborhoods enabling cities and states to buy up and rehabilitate foreclosed and abandoned homes that are driving down home prices, and destabilizing neighborhoods.

Republicans Have Long Ignored the Foreclosure Crisis
Over the past four years, Republicans have repeatedly voted against legislation to address the foreclosure crisis - against stopping the abusive practices of some in the financial industry that contributed to the foreclosure crisis, while denying help to the millions of families at risk of losing their homes.  Most Republicans voted:

  • To eliminate HUD funding for housing counseling to keep people in their homes, as one of their first priorities this Congress. [2011]
  • Three times against comprehensive anti-predatory lending legislation including in the Wall Street Reform and Consumer Protection Act - to stop reckless, abusive and irresponsible mortgage lending practices that played a major role in the financial crisis and to make sure that families get mortgages they can repay.  [2007, 2009, 2010]
  • Twice against a first-time homebuyer's tax credit to spur home buying. [2008, 2009]
  • Against a comprehensive foreclosure crisis bill to prevent families from losing their homes and their neighbors from losing value in their homes -- with expanded opportunities to refinance into lower-cost government-insured mortgages families can afford to repay, putting in place a tough, independent new regulator in charge of Fannie Mae and Freddie Mac.  [2008]
  • Against legislation to push lenders into modifying loans for families in danger of losing their homes, by allowing bankruptcy judges, as a court of last resort, to modify loans for families with existing mortgages. [2009]