Home prices are gradually increasing and foreclosures are declining, but our slow-moving housing recovery still leaves many Californians with significant financial struggles. Many families are either barely able to make mortgage payments or stuck in a home that is still worth less than the amount owed. In our district, 20 percent of the 50,000 homes backed by Fannie Mae are “under water” and in jeopardy of foreclosure.
Our economy will continue to struggle and consumer confidence will never return unless we fix our housing situation.
To improve our housing market we need to:
• Allow all homeowners to refinance their mortgages at today’s historically low rates. This would put an average of $3,000 per year back into the pockets of middle class families.
• Put a principal reduction plan in place for underwater homeowners that would allow their mortgages to more accurately reflect the market value of their house. The Federal Housing Finance Agency’s (FHFA) own analysis and the nonpartisan Congressional Budget Office (CBO) both conclude that implementing principal reduction programs for underwater mortgages backed by Fannie Mae and Freddie Mac could save U.S. taxpayers billions of dollars by avoiding unnecessary defaults, helping homeowners avoid foreclosures and remain in their homes, and stimulating additional growth across the economy.
• Begin the process of reforming Fannie Mae and Freddie Mac so that they can begin to function as a backstop for catastrophic failure rather than as a first line guarantor for mortgages.
These policies will help keep people in their homes and keep neighborhood values up. That’s good for families, our communities, our district and our economy.
If you are facing problems with your mortgage, we might be able to help. You can contact my district offices here.
More on Housing
The effect of the government shutdown has been felt across the country, including Martinez. While federal courts can run for approximately two weeks on reserve funds before possibly having to succumb to closures, courthouses in Martinez are safe because they are under the California Superior Court System.