[Congressional Record (Bound Edition), Volume 151 (2005), Part 17]
[Extensions of Remarks]
[Pages 22747-22748]
[From the U.S. Government Publishing Office, www.gpo.gov]




 INTRODUCTION OF THE HURRICANE DISASTER MORTGAGE MORATORIUM ACT OF 2005

                                 ______
                                 

                        HON. ELIJAH E. CUMMINGS

                              of maryland

                    in the house of representatives

                        Friday, October 7, 2005

  Mr. CUMMINGS. Mr. Speaker, I rise today to introduce The Hurricane 
Disaster Mortgage

[[Page 22748]]

Moratorium Act of 2005, which would provide a 6-month moratorium on 
mortgage payments owed by residential and commercial property owners 
who reside in the disaster areas of Hurricanes Katrina and Rita. This 
bill would provide a temporary refuge from payment for those 
individuals and entities who are unable to make their mortgage payment 
obligations.
  Mr. Speaker, as we know, the devastation wreaked by Hurricanes 
Katrina and Rita was of colossal proportion. The ensuing fallout of 
lost jobs, destroyed homes and shattered lives is equally devastating.
  Needless to say, the figures that have begun to be compiled in the 
aftermath of the storm are staggering. Analysts with the National 
Association of Realtors are projecting that at least 200,000 homes in 
the Gulf Coast region have been destroyed or will have to be 
demolished. The U.S. Department of Commerce has estimated that 
uninsured losses could easily exceed $100 billion. Sadly, up to a 
million Americans were displaced by the storms and many are still 
living in temporary shelters.
  The Department of Labor job figures released today show that 
unemployment is up to 5.1 percent for September, up from a 4.9 percent 
pre-Katrina and Rita level and much higher than the 4.0 percent level 
we experienced during the 1990s. According to the Joint Economic 
Committee Democratic staff, the unemployment rate would in fact be 9.0 
percent if the figure included those who are marginally attached to the 
labor force and those who are forced to work part-time because of the 
weak economy. The Houston Chronicle on October 6, 2005 reported that as 
a result of Hurricanes Katrina and Rita, at least 363,000 people have 
lost their jobs. These dismal numbers are likely to remain constant in 
the short-term as our nation rebuilds this region.
  In fact, most of those unemployed as a result of Hurricanes Katrina 
and Rita are expected to be out of work at least 6-9 months and we 
should only anticipate the indicators to increase. As we know, just 
this week we heard Mayor Ray Nagin of New Orleans inform that he has to 
let go of 3,000 municipal employees because the City cannot afford to 
pay them. This unfortunate scenario will surely be repeated to some 
extent throughout the region as municipal and state coffers dwindle 
from depleted revenue bases.
  Whereas the number of job losses for the month of September is 
surprisingly only 35,000, the Department of Labor reported that last 
week, it received an additional 74,000 hurricane-related unemployment 
claims. In fact, nearly one in every five unemployed people--1.5 
million Americans have been jobless for more than 26 weeks, the maximum 
number of weeks for receiving regular unemployment insurance benefits 
and the Hurricanes will only exacerbate these passive numbers.
  The CBO predicts that the Hurricanes could actually cut job growth by 
between 280,000 and 400,000 jobs. Although it may sound obvious, 
Americans who have lost everything in a hurricane, who are not working 
and have little prospects of working in the near future cannot afford 
to pay their mortgages. This bill would provide them with a reprieve 
from their mortgage payments. Also, as it does not mandate forgiveness 
of this debt, this bill reflects the shared burden that our Nation will 
have to shoulder temporarily during this time of rebuilding.
  Mr. Speaker, behind these figures are thousands of home and business 
owners whose entire livelihoods have been destroyed and who now face 
the prospect that the properties they have worked a lifetime to 
purchase could be taken from them when they fall behind in their 
mortgages. This bill provides a temporary sanctuary from payment and 
stops the clock for any default or foreclosure proceedings and negative 
credit reporting.
  Needless to say the economic effects of the Hurricanes are being felt 
in painful increments nationwide. However, for the Americans forced out 
of their homes by the Hurricanes, the economic effects are not coming 
in the form of a trickle, but a deluge.
  The Hurricane Disaster Mortgage Moratorium Act of 2005 will ensure 
that during the moratorium, those Gulf Coast residents who cannot 
afford to pay their mortgages will not lose their homes or suffer the 
negative attendant consequences from non-payment. Let's not make these 
Americans suffer needlessly by facing the prospect of losing their 
homes twice. I urge my colleagues to support this effort.

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