[StBernard] House Passes Legislation to Help Homeowners, Reform Federal Housing Administration

Westley Annis Westley at da-parish.com
Fri Jun 11 22:27:21 EDT 2010


House Passes Legislation to Help Homeowners, Reform Federal Housing
Administration



Washington, DC - The U.S. House of Representatives passed legislation
introduced by Congresswoman Maxine Waters (D-CA) to help families realize
the dream of homeownership, protect Americans from mortgage fraud and save
taxpayers money. The FHA Reform Act of 2010 (H.R. 5072) ensures that the
Federal Housing Administration (FHA) remains viable and continues its
mission of insuring mortgage loans. The bill passed overwhelmingly by a
vote of 406-4.



For further information about the FHA Reform Act click here
<http://portal.hud.gov/portal/page/portal/HUD/press/speeches_remarks_stateme
nts/2010/statement-061010> .



"The FHA Reform Act is important for households across the country because
it will enable FHA to respond to the current housing and economic crisis and
continue to provide opportunities to millions of Americans for
homeownership. As the private market has contracted, FHA has stepped into
the void and injected much-needed credit into our mortgage system.
Increasingly, it is the only option available for American homebuyers with
less than a 20 percent down payment," said Congresswoman Waters.



FHA has filled a vital role in the nation's economy, helping 37 million
Americans attain homeownership since 1934. FHA insurance has been
particularly important for minority communities, low-income families, and
first-time homebuyers.



Congresswoman Waters, chairwoman of the Subcommittee on Housing and
Community Opportunity, drafted the FHA Reform Act in response to news that
FHA's reserves had fallen below the two percent level required in law. The
Act will strengthen FHA's finances and save taxpayers $2.5 billion over five
years, while still providing affordable mortgage insurance to the
individuals FHA is intended to serve.





H.R. 5072 also provides FHA with enhanced authority to crack down on lenders
engaged in fraud or misrepresentation or failing to comply with FHA
guidelines for originating or underwriting loans. "Families, neighborhoods
and the nation's housing market have been hurt by irresponsible lending and
mortgage fraud schemes, and we need to make sure homebuyers are protected.
FHA has already taken steps to increase its lender enforcement activities,
and this bill empowers the agency to root out the bad actors while reserving
the program for the lenders that follow the rules," Congresswoman Waters
said.



In addition, Congresswoman Waters' legislation requires FHA to improve its
internal controls to better manage risk and to provide transparent data to
the public and to Congress. This includes improving monitoring of early
defaults and claims, tracking mortgage information by loan servicer,
providing FHA with the ability to contract out for additional credit risk
analysis, requiring mortgagees to report to FHA when they stop buying loans
from other mortgagees and requiring a Government Accountability Office study
on FHA and Ginnie Mae. The bill also creates a new Deputy Assistant
Secretary at FHA for Risk Management and Regulatory Affairs.



Congresswoman Waters drafted the legislation after conducting three hearings
on FHA in the last six months. She worked closely with both Democratic and
Republican colleagues to produce a bill that gained bipartisan support.



H.R. 5072 has the support of a diverse group of organizations including the
National Urban League, the National Council of La Raza, the National
Community Reinvestment Coalition, the Mortgage Bankers Association, the
National Association of Realtors and the National Association of Home
Builders.







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