Housing Help Too Critical To Eliminate

WASHINGTON, DC – In advance of a vote later today in the U.S. House of  Representatives to eliminate the Home Affordable Modification Program (HAMP) – a program designed to help struggling homeowners  at risk of foreclosure due to a structural gap between monthly mortgage payments and income – U.S. Congressman David Cicilline (D-RI) says he will vote against its elimination and will fight to protect this important program.

“A safe and affordable home is one of the keys to the American Dream and central to a strong neighborhood and a thriving economy. But that dream has been fading for many Rhode Island families, because our state has been hit extremely hard by the foreclosure crisis. 

“Nearly 5,000 foreclosures occurred in Rhode Island over the past two years. Another 13,000 homes are either in the foreclosure process or more than 90 days delinquent. Our housing struggles are the worst in New England, and rank among the top ten states in terms of foreclosure rates.

“But rather than provide much-needed assistance to homeowners as our economy continues to recover, the House is set to consider a proposal that will cut a critical foreclosure prevention program during one of the worst housing downturns in our nation’s history. 

“Even the leading critics of HAMP do not recommend terminating the program, which facilitates mortgage modifications that are in the best interest of both homeowners and investors, by reducing mortgage payments to 31% of monthly income.

“Cutting this program is foreclosing on the middle class. It will increase foreclosures, damage home prices and further destabilize the housing market and economy recovery.The fact of the matter is that we still face a serious housing crisis in this country and HAMP is one of the resources we can provide to homeowners as we continue working to address it. At a time when our economy is beginning to recover, we should not be cutting from these housing programs because the housing sector is key to our economic recovery.

“While HAMP has room for improvement – and I have taken actions with my colleagues toward achieving such goals – it is important to recognize that state and local governments do not have the resources to implement similar foreclosure mitigation programs.  Terminating HAMP will remove critical safety nets for struggling homeowners and leave them at the mercy of the lenders and servicers whose predatory practices and faulty loans got us into this mess in the first place.”

Earlier this month, Congressman Cicilline joined several of his House colleagues, including Congressman Langevin, in a letter addressed to Treasury Secretary Geithner, requesting changes to improve HAMP. Those changes include:

• Establishing a single point of contact for borrowers;
• Ending dual tracking and;
• Providing for independent review of loan medication denials.