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Press Release

March 5, 2009

Rep. Susan Davis Supports Plan to Keep Americans in their Homes

140,000 homes in California could be saved

WASHINGTON – Congresswoman Susan Davis (D-San Diego) voted for the Helping Families Save Their Homes Act (H.R. 1106) to give homeowners the option to declare bankruptcy on a primary residence in order to avoid foreclosure on their homes. 

Currently, filing for Chapter 13 on a primary residence - as opposed vacation homes, family farms, or investment real estate - is not allowed.  If bankruptcy is an option for homeowners, it would act as an incentive for lenders to voluntarily modifying loans, which lenders have been reluctant to do thus far.

“This recession started with the housing crisis.  It is vitally important that we address the crisis,” Davis said.  “Without spending one federal dollar, this legislation could save 140,000 homes in California from facing foreclosure.”

Home prices dropped 18 percent in the last quarter of 2008.  More than 14 million homeowners owe more on their mortgage than their home is worth, and they cannot refinance.  Many are facing foreclosure through no fault of their own. This bill is an important step in helping America recover.

“Stabilizing the housing market is central to restoring the American economy,” Davis said.  “We all stand to lose if we do not stop the steep decline in home prices.”

Each foreclosed home reduces nearby property values by as much as 9 percent. H.R. 1106 would compliment President Obama’s plan to help 7 to 9 million American families from losing their homes, and their neighbors from losing value in their homes.

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