[Congressional Record Volume 157, Number 10 (Tuesday, January 25, 2011)]
[Senate]
[Page S228]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mrs. BOXER:
  S. 170. A bill to provide for the affordable refinancing of mortgages 
held by Fannie Mae and Freddie Mac; to the Committee on Banking, 
Housing, and Urban Affairs.
  Mrs. BOXER. Mr. President, I rise today to introduce the Helping 
Responsible Homeowners Act of 2011. This legislation will eliminate 
barriers that have prevented millions of borrowers who continue to make 
their payments on time from taking advantage of historically low 
interest rates and refinancing their mortgages.
  Despite a recent uptick, interest rates for 30-year home mortgages 
remain at historically low levels--under five percent. Yet of the 31.5 
million mortgages guaranteed by Fannie Mae and Freddie Mac, nearly 13 
million still carry an interest rate at or above 6 percent. This bill 
would allow non-delinquent mortgages to be refinanced at current rates, 
putting hundreds of dollars a month back in the pockets of struggling 
families.
  The Administration's Home Affordable Refinance Program has resulted 
in Fannie Mae and Freddie Mac refinancing 520,000 loans through October 
2010, far short of its goal of assisting four to five million 
homeowners.
  One reason for the program's failure is that Fannie and Freddie 
continue to charge risk-based fees to refinance a loan they already 
guarantee. These additional fees can be as high as two percent of the 
loan amount, or an extra $4,000 on a $200,000 loan. In my home state of 
California, where prices are higher, that might be $8,000 on a $400,000 
loan. For borrowers struggling to keep up with their payments, this is 
an additional cost they simply cannot afford.
  Fannie and Freddie already bear the risks on these loans; yet this 
policy actually makes it less likely that borrowers will be able to 
take advantage of the low rates and increases the chance they will 
eventually default.
  Many borrowers also have been blocked from refinancing by the owner 
of their second mortgage, even though reducing payments on the first 
mortgage would make it more likely the borrower would be able to 
continue making payments on the second.
  To remove these barriers and allow borrowers current on their 
payments to refinance their loans, the Helping Responsible Homeowners 
Act would eliminate risk-based fees on loans for which Fannie and 
Freddie already bear the risk; remove refinancing limits on properties 
that lost value during the real estate crisis; make it easier for 
borrowers with second mortgages to participate in refinancing programs; 
and require that borrowers are able to receive a fair interest rate, 
comparable to that received by any other current borrower who has not 
suffered a drop in home value.
  At a time when millions of Americans have been forced out of their 
homes, this legislation will ensure that homeowners who make their 
payments on time will be able to refinance their mortgages at current 
low rates so they can stay in their homes. I urge my colleagues to join 
me and to support this legislation.
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