French HillChairman

H.R. 1182 ends the taxpayer-funded bailouts of Fannie Mae and Freddie Mac and put these two companies on a path towards privatization.  The failures of the two government-sponsored enterprises (GSEs) have directly cost taxpayers more than $150 billion. H.R. 1182 is sponsored by Rep. Jeb Hensarling.

H.R. 839, introduced by Rep. Patrick McHenry (NC), would terminate Treasury’ authority to provide new assistance under the Home Affordable Modification Program (HAMP) while preserving the contracts made prior to the bill’s enactment. H.R. 839 prevents $30 billion in TARP funds from being spent.

Background:
HAMP was announced by the Administration in February 2009 as part of a three-part “Making Home Affordable Program.” $30 billion in TARP funds were set aside for HAMP to provide payments to mortgage servicers for modifying mortgages of struggling borrowers. The Administration claimed HAMP would help up to 4 million homeowners. Instead, only 521,630 loans have been permanently modified under this program and the re-default rate is high. From the $30 billion earmarked for HAMP only $840 million has gone out the door. There is widespread criticism that HAMP is not working and is only making matters worse for many of the homeowners who participate or seek to participate. The Special Inspector General for TARP (SIGTARP), the Congressional Oversight Panel, and the Government Accountability Office have all detailed the shortcomings of HAMP and highlighted how this program has hurt, rather than helped, struggling homeowners. Rewarding servicers with taxpayer dollars to modify mortgages has proven costly, Treasury estimates a $20,000 cost to taxpayers for each successful HAMP modification.

H.R. 861, introduced by Rep. Gary Miller (CA) on March 1, terminates the Neighborhood Stabilization Program (NSP) and prevents $1 billion from being spent on this program.

Background:
In 2008 the Democrats’ GSE bailout bill (the Housing and Economic Recovery Act) established the NSP with $4 billion in funding.  NSP provides taxpayer dollars to State and local governments to purchase, renovate, rebuild, and resell abandoned and foreclosed property. The Democrats added another $1.93 billion in funding to the NSP through the Obama stimulus plan in 2009 and another $1 billion in the Dodd-Frank Act.  The program has been plagued with problems.  Since its inception, NSP has lacked proper protocols that prevent the misuse of funds. The Inspector General for the Department of Housing and Urban Development (HUD) has identified multiple cases of misused NSP funds, and GAO has detailed HUD’s inadequate tracking of NSP funds.

H.R. 836, introduced by Rep. Jeb Hensarling on February 28, 2011, ends HUD’s Emergency Homeowners Relief Program and prevents $1 billion from being spent on this program that increases struggling homeowners’ debts. 

Background:

The Dodd-Frank Act established a $1 billion HUD Emergency Homeowner Relief Program, which provides loans or credit advances to unemployed borrowers who cannot pay their mortgages because of unemployment or reduction in income.  Payments under the program may be provided for 12 months, with a possible 12-month extension. The Obama Administration, in its FY 2012 budget proposal, estimates the program to have a 98 percent subsidy rate.  This means for every $1 spent on this Federal program, the taxpayers will lose 98 cents. The program was initially authorized in 1975 and was never funded during its 35 year history.