Another Stopgap for Flood of Foreclosure Homes- By: John Cutts
Representative Tim Bishop has issued a statement in support of the Helping Families Save Their Homes Act which was approved by the U.S. House of Representatives. The bill, which is aimed at abating the flood of foreclosure homes in the county, is now on the Senate for consideration.
The measure is expected to be an integral part of the Homeowner Affordability and Stability Plan of President Barack Obama.
The Bishop-supported bill will focus on providing ways to address foreclosure homes problem and boost the availability of mortgage credit by allowing bankruptcy judges to modify loans for distressed homeowners who filed for bankruptcy protection.
The measure is expected to boost mortgage refinancing to stop foreclosure homes increase by giving flexibility on loan modifications, reducing fees and providing incentives to mortgage lenders who choose to refinance instead of adding to the growing list of foreclosure homes.
According to the Mortgage Bankers Associationís (MBA) National Delinquency Report, mortgage delinquencies and filings for foreclosure homes posted an 11 percent increase during the fourth quarter of 2008.
The number of mortgage loans at least one month behind in payments but not yet in the foreclosure process jumped by 8 percent, representing a 13 percent increase from the previous quarter.
The MBA data also showed that the number of foreclosure homes increased by 3.3 percent during the fourth quarter of 2008, representing a 1.26 percent jump from the previous year.
Meanwhile, data from Bishopís office showed that housing prices declined 18 percent during the fourth quarter of 2008 and over 14 million troubled homeowners owe more mortgages than the fair market value of their distressed properties.
Bishop said that stabilizing and strengthening the housing industry is crucial to the recovery of the U.S. economy. He pointed out that foreclosed homes reduced the value of neighboring properties by almost 9 percent and every American will suffer if house prices will continue its rapid decline.
He added that the bill does not require spending federal money to be able to help thousands of distressed homeowners who are facing the threat of losing their homes to foreclosure.
The Homeowner Affordability and Stability Plan includes measures to reduce mortgage payments for an estimated 9 million struggling homeowners and expand the role of Federal Home Loan Mortgage Corp. and Federal National Mortgage Association in stopping foreclosures.
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John Cutts has been educated in the finer points of the foreclosure market over 5 years.