July 26, 2008

Senator Whitehouse Speaks on the Senate Floor About the Housing Reform Bill

Mr. WHITEHOUSE. Thank you, Mr. President. I rise today with good news and bad news for the American people. The good news is that the United States Senate is poised to pass legislation providing badly-needed relief for millions of American families in their darkest days: families who stand on the verge of losing their homes. The bad news is that this critical assistance will come only after long, needless delay due to obstruction and political gamesmanship by some members of the Republican minority in this body.

For too many people in this country, times are as tough as they have ever been. With millions of Americans mired in the subprime loan crisis, families across the nation stand just one lost job, one medical expense, one credit card penalty fee, or one car accident away from losing the roof over their heads. Last month, over a quarter-of-a million homes received a foreclosure notice – that’s up over 50% from the same period last year. In my state of Rhode Island alone, a state with a population of around one million people, over 3,800 homes were in foreclosure in the first quarter of this year alone.

The collapse of the subprime mortgage market has left financial institutions in ruins, left families struggling, and left our economy vulnerable to even more widespread damage, especially as the cost of energy rises. For the first time in generations, Americans now face the prospect of leaving to their children a life with fewer opportunities and greater uncertainty than we inherited from our parents. Our children deserve better.

Democrats in the Senate and the House of Representatives have worked with Republicans to craft a bipartisan measure that will offer the assistance millions of families need to weather the housing crisis today and the reforms necessary to prevent a future housing market implosion. This legislation would authorize the Federal Housing Administration to provide up to $300 billion in mortgages to distressed homeowners. This program will help over a million homeowners replace their subprime high-rate, low-quality mortgages with quality loans at reasonable rates. In addition, our housing rescue measure would modernize the FHA to permit it to insure a greater number of quality mortgages. For many homeowners and homebuyers, FHA-backed mortgages are the only alternative to the subprime market.

The housing rescue package also includes $150 million for foreclosure prevention counseling and $4 billion for communities to buy and restore foreclosed and abandoned properties. Moreover, the bill mandates new disclosure requirements to ensure that future homebuyers are not tricked into mortgages with rates that can change unexpectedly.

This disclosure provision, like so many other elements of this landmark housing bill, was authored by my senior senator from Rhode Island, Senator Jack Reed. Senator Reed, who serves on the Banking, Housing, and Urban Affairs Committee, has been among the leading voices in the Senate on this issue, working to combat predatory lending and other tactics that disadvantage consumers. Senator Reed also fought to ensure that this housing bill includes an affordable housing trust fund that will produce and rehabilitate homes for low-income families, many of whom have been priced out of the housing market. It will literally bring thousands of families out from the cold, and I congratulate Senator Reed for his tireless efforts to see this important assistance written into the law of the land.

Mr. President, I am gratified that we are able to finally pass this critical legislation, and that President Bush has finally come to his senses and dropped his longstanding veto threat. This bill represents long-needed and long-awaited relief for American homeowners, and I urge President Bush to sign this legislation without delay as soon as it reaches his desk. I thank the chair and I yield the floor.