UDALL VOTES TO PROTECT HOMEOWNERS AND ECONOMY

Says President Should Work With Congress to Aid Ailing Housing Market Instead of Issuing Veto Threats

WASHINGTON - U.S. Representative Tom Udall, D-N.M., today acted to protect homeowners, neighborhoods and the American economy from housing foreclosures by working to pass H.R. 5818, the Neighborhood Stabilization Act, and H.R. 3221, the American Housing Rescue and Foreclosure Prevention Act. Udall also urged the president to reverse his veto threat and support the sweeping legislative effort.

"Helping the housing market recover is critical to turning our economy around," said Udall. "The economy has lost jobs for the fourth straight month and that contributes to the financial challenges New Mexicans are facing as they continue to deal with the economic downturn and record increases in food and gas prices. Instead of issuing a veto threat against this package and denying the seriousness of the situation, President Bush should do everything in his power to facilitate a turnaround."

H.R. 5818 would establish a $15 billion loan and grant program for the purchase and rehabilitation of owner-vacated, foreclosed homes with the goal of stabilizing neighborhoods immediately. Half of the funding would be for loans, and the other half would be for grants. At least 50 percent of the grant money must be targeted to house families at or below 50 percent of an area's median income, and not less than half of this money must target families at or below 30 percent of median income.

H.R. 3221 would:

• Give first-time homebuyers a refundable tax credit that works like an interest-free loan of up to $7,500 to spur home buying and stabilize the market;
• Supply states with $10 billion of additional tax-exempt bond authority in 2008 to refinance subprime loans, make loans to first-time homebuyers and finance the building of affordable rental housing;
• Provide taxpayers that claim the standard deduction with up to an additional $700 standard deduction for property taxes;
• Make necessary reforms to encourage the creation of low-income housing;
• Reform Fannie Mae and Freddie Mac and allow them to help more homeowners; and,
• Give our veterans access to larger low-cost loans.

Said Udall, "The aim of these bills is to help our homeowners and our renters and aid our neighborhoods and economy. Also, by demanding that borrowers and lenders make concessions to receive support, these bills require individuals to take responsibility without allowing their neighbors and our economy to suffer."

Although New Mexico has not been as severely impacted as other states, a study by the Pew Charitable Trusts predicts that if nothing is done, New Mexicans could face significant numbers of foreclosures in the next two years due to subprime loans taken out in 2005 and 2006 – one foreclosure for every 56 owner-occupied units. The impact of those foreclosures could reduce property values by over $500 million for the 151,430 New Mexico homes in impacted neighborhoods. Housing prices have already declined 7.37 percent statewide, costing the state $5.75 billion
in lost home values and a reduced tax base.

"The foreclosure crisis facing this nation affects far more than only those having mortgage problems," said Udall. "It threatens every homeowner in the state and is costing working New Mexicans millions in lost assets and we must take action to mitigate the effects now."

H.R. 5818 passed by a vote of 239-188. H.R. 3221 passed in the form of three amendments. The first passed by a vote of 266-154; the second, 322-94; and, the third, 356-160.