An Influx of Housing Bills Awaits the New President
Just days before the inauguration of President-elect Barack Obama, legislators and lawmakers are composing a variety of proposed bills aimed at reforming the face of housing in 2009. The influx of new bills is in its early stages, but it will certainly make for no shortage of work for the 111th Congress and the 44th President of the United States. H.R. 600, a bill sponsored by Al Green, D-Texas that aims to "revise the requirements for seller-financed downpayments for mortgages for single-family housing insured by the secretary of Housing and Urban Development," was referred on Jan. 16 to the House Committee on Financial Services. The bill boasts two long-time compatriots in the case for seller-funded DPA, Maxine Waters, D-Calif. and Gary Miller, R-Calif., as co-sponsors. It has been introduced and awaits further review. Text of the proposed legislation was not available at the time this story was published and Green's office did not return calls seeking comment early Monday. The bill arrives as a counter-argument to the provision within the Housing and Economic Recovery Act, passed July 2008, that banned seller-funded down-payment assistance programs beginning Oct. 1, 2008. The Nehemiah Corp. of America has been a long-time supporter of seller-funded down-payment assistance, as one of the leading nonprofit organizations that made use of the provision that originally allowed the practice. Nehemiah officials consistently defend seller-funded down-payment assistance programs as homeownership opportunities for people who otherwise couldn't afford to save up for the necessary down-payment and closing costs without using taxpayer money. "Creating opportunities for sustainable homeownership will be a cornerstone to strengthening a crumbling housing market and breathing life back into the economy," said Nehemiah president Scott Syphax Monday. "As the Obama Administration takes the reins tomorrow, we call on Congress to reach across the aisle and prioritize broadening opportunities for responsible homeownership in America by reinstating DPA.” While the fate of seller-funded DAP is still unknown, lawmakers continue to line in Congress with shiny new housing bills aimed at passage sometime in 2009. For instance, Miller is making headlines elsewhere with two other bills he has sponsored and were referred Friday to the House Committee on Financial Services. H.R. 607, which aims "to direct the Securities and Exchange Commission to issue guidance on the interpretation of fair value accounting," and H.R. 587, which aims "to increase the loan limits for the FHA single-family housing mortgage insurance programs...and for the conforming loan limits for Fannie Mae (FNM) and Freddie Mac (FRE) during 2009," are both awaiting further review by the committee. Regarding H.R. 587, Miller issued a press statement explaining a temporary increased loan limit expired Dec. 31, limiting the reach of loans backed by the Federal Housing Administration and essentially making the cost of buying a home increase. "We need to keep affordable mortgage financing available at a time when the housing markets are facing their greatest challenge in 70 years," Miller said. "By permanently increasing loan limits, this bill would go a long way toward turning the housing market around." Of H.R. 607, Miller released a separate statement arguing that, under current fair market value accounting standards, a lack of liquidity in performing assets during times of financial market distress complicates the pricing process. The statement also cited a recent ruling by the SEC that recommended improving these accounting rules for such impaired securities. “I believe fair value accounting standards may have contributed to the general devaluation of mortgage-backed securities,” he said. “To better reflect the true value of assets in both functioning and illiquid markets and to take steps toward overall economic recovery, it is imperative that the SEC provide sufficient guidance on the interpretation of fair value accounting standards.” Write to Diana Golobay at email@example.com.