News From…
Congressman Dennis Cardoza
18th Congressional District of California
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| FOR IMMEDIATE RELEASE September 18, 2007 |
CONTACT: Jamie McInerney (202) 225-6131 |
| WASHINGTON – Today Congressman Dennis Cardoza sponsored an amendment to HR 1852 with Congressman Barney Frank (MA-04) and Congressman Gary Miller (CA-42) to address the mortgage crisis sweeping across the country. The Cardoza/Frank/Miller amendment, and overall bill, will revitalize the Federal Housing Administration (FHA) to restore its historical role in insuring critically needed mortgage loans for low and middle income families.
“Sadly, I represent communities that have been dubbed ‘foreclosure capitol USA’ by the national media because of foreclosure rates around 1 in 27 homes in some places,” said Cardoza. “This bill, with our amendment included, puts FHA back in business. Our amendment allows FHA to provide relief to all borrowers across the country, including regions with high median home values like California, that FHA is currently prohibited from serving.”
The Cardoza/Frank/Miller amendment raises the FHA single family loan limits, which now bar loans above 95% of the median home price in each local area and shut FHA out of higher cost home markets. This amendment raises the FHA loan limit in each area to the lower of (a) 125% of the local area median home price, or (b) 175% of the national GSE conforming loan limit. The amendment also gives the Housing and Urban Development (HUD) Secretary the authority to raise these loan limits by up to $100,000 if market condition warrant.
The biggest impact of the Cardoza/Frank/Miller amendment will be to make FHA loan insurance available in low and moderately priced home markets. The current loan limits exclude FHA from serving a large segment of moderately priced homes in higher cost areas such as California, New York, Connecticut, and Massachusetts. The new loan limits and rules will also allow FHA to assist borrowers that turned to predatory loans and who are now facing loan resets, in refinancing their mortgages on more favorable terms.
San Joaquin, Stanislaus, and Merced Counties in California have been particularly hard hit by the foreclosure crisis. RealtyTrac, which monitors foreclosure rates across the U.S., calculated that foreclosure notices went to 1-in-79 homes in Stanislaus County, 1-in-81 homes in San Joaquin County and 1-in-82 homes in Merced County. The national foreclosure notice rate was 1-in-510 homes and 1-in-224 homes throughout California.
The Cardoza/Frank/Miller amendment passed as part of HR 1852, the Expanding American Home Ownership Act, which was approved by the House 348-72. |
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