[Congressional Record (Bound Edition), Volume 153 (2007), Part 18]
[House]
[Pages 24518-24523]
[From the U.S. Government Publishing Office, www.gpo.gov]




     PROVIDING FOR CONSIDERATION OF H.R. 1852, EXPANDING AMERICAN 
                       HOMEOWNERSHIP ACT OF 2007

  Ms. MATSUI. Mr. Speaker, by direction of the Committee on Rules, I 
call up House Resolution 650 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 650

       Resolved, That at any time after the adoption of this 
     resolution the Speaker may, pursuant to clause 2(b) of rule 
     XVIII, declare the House resolved into the Committee of the 
     Whole House on the state of the Union for consideration of 
     the bill (H.R. 1852) to modernize and update the National 
     Housing Act and enable the Federal Housing Administration to 
     use risk-based pricing to more effectively reach underserved 
     borrowers, and for other purposes. The first reading of the 
     bill shall be dispensed with. All points of order against 
     consideration of the bill are waived except those arising 
     under clause 9 or 10 of rule XXI. General debate shall be 
     confined to the bill and shall not exceed one hour equally 
     divided and controlled by the chairman and ranking minority 
     member of the Committee on Financial Services. After general 
     debate the bill shall be considered for amendment under the 
     five-minute rule. The amendment in the nature of a substitute 
     recommended by the Committee on Financial Services now 
     printed in the bill, modified by the amendment printed in 
     part A of the report of the Committee on Rules accompanying 
     this resolution, shall be considered as adopted in the House 
     and in the Committee of the Whole. The bill, as amended, 
     shall be considered as the original bill for the purpose of 
     further amendment under the five-minute rule and shall be 
     considered as read. All points of order against provisions in 
     the bill, as amended, are waived. Notwithstanding clause 11 
     of rule XVIII, no further amendment to the bill, as amended, 
     shall be in order except those printed in part B of the 
     report of the Committee on Rules. Each further amendment may 
     be offered only in the order printed in the report, may be 
     offered only by a Member designated in the report, shall be 
     considered as read, shall be debatable for the time specified 
     in the report equally divided and controlled by the proponent 
     and an opponent, shall not be subject to amendment, and shall 
     not be subject to a demand for division of the question in 
     the House or in the Committee of the Whole. All points of 
     order against such further amendments are waived except those 
     arising under clause 9 or 10 of rule XXI. At the conclusion 
     of consideration of the bill for amendment the Committee 
     shall rise and report the bill, as amended, to the House with 
     such further amendments as may have been adopted. The 
     previous question shall be considered as ordered on the bill 
     and amendments thereto to final passage without intervening 
     motion except one motion to recommit with or without 
     instructions.
       Sec. 2. During consideration in the House of H.R. 1852 
     pursuant to this resolution, notwithstanding the operation of 
     the previous question, the Chair may postpone further 
     consideration of the bill to a time designated by the 
     Speaker.

  The SPEAKER pro tempore. The gentlewoman from California is 
recognized for 1 hour.
  Ms. MATSUI. Mr. Speaker, for the purpose of debate only, I yield the 
customary 30 minutes to the gentleman from Texas (Mr. Sessions), 
pending which I yield myself such time as I may consume. During 
consideration of this resolution, all time yielded is for the purpose 
of debate only.
  Mr. Speaker, as the Clerk just read, H. Res. 650 provides for 
consideration of H.R. 1852, the Expanding American Homeownership Act, 
under a structured rule. The rule provides 1 hour of general debate to 
be controlled by the Committee on Financial Services. The rule makes in 
order seven amendments printed in the Rules Committee report.
  This bill is being considered under a structured rule that will allow 
the House to consider amendments to address important issues with 
regard to this legislation. I look forward to the debate on the 
important issue before us today.

[[Page 24519]]

  I rise today in support of the rule providing for the consideration 
of the Expanding American Homeownership Act and for the underlying 
legislation. I thank Subcommittee Chairwoman Waters for offering this 
bill. I thank Chairman Frank and Ranking Member Bachus for their hard 
work, along with the other members of the Financial Services Committee, 
in bringing this important legislation to the floor.
  The bill underlying this house resolution addresses an issue of 
critical importance to our constituents and to our economy, the 
subprime mortgage lending crisis. We are here today to consider 
reforming the Federal Housing Administration's loan policies as a means 
of stemming the tide of foreclosures that have besieged our Nation.
  Owning a home is part of the American Dream, but predatory lenders 
have been crushing that dream by taking advantage of home buyers with 
damaged credit. Lured by attractive initial terms, vulnerable home 
buyers who do not qualify for federally backed loans take on subprime 
mortgage loans that they cannot afford. These loans come with 
escalating interest rates which start low and encourage overborrowing. 
The borrowers learn too late, when their homes are foreclosed upon, 
that they will not be able to afford those higher payments.
  We are now faced with the unfortunate situation that our residents 
are losing their homes in record numbers. The increasing rate of 
foreclosure continues to make the news in California and across the 
Nation. Data released just last month show the rising foreclosure rates 
in cities across the country. The numbers are as high as one 
foreclosure in every 27 households. That is not acceptable.
  And the housing market continues to suffer. Last week a report from 
my Sacramento district cited a more than 13 percent drop in the median 
home prices in the past year. That is the largest 1-year drop in 20 
years.

                              {time}  1030

  Despite good economic growth in the region, the housing market is in 
trouble. Many point to the subprime mortgage crisis to explain this. 
Trends like this can be seen across the country, not just in 
Sacramento.
  The administration wants to allow 80,000 people to refinance their 
loans through FHA. That is good but it is not going to address the 
scope of this problem. More than 2 million adjustable rate mortgages 
are up for reset this fall, at which time their interest rates will 
increase. Two million mortgages, that is 2 million more families who 
will be at risk at losing their homes if they cannot keep up with the 
higher payments. This pattern cannot continue.
  The housing market crunch, driven by the subprime mortgage lending 
troubles, is making waves throughout our economy. Over the past few 
months, we have seen the Federal Reserve cut its discount rate and make 
an additional $62 billion available to try to stabilize the real estate 
financial market. Last month, Countrywide Financial, the largest home 
mortgage lender, was trading at levels comparable to junk bonds. And, 
lastly, AIG, the world's largest insurer and one of the biggest 
mortgage lenders, stated that delinquencies and foreclosures are 
becoming more common among borrowers whose credit rates are just above 
subprime. So the problem is getting worse, not better. Congress needs 
to act and we need to act now.
  The bill we are considering today will overhaul the Federal Housing 
Administration to make federally backed loans competitive with subprime 
and other nontraditional mortgage loans. We need to make sure that 
subprime mortgages are properly regulated to get our home buyers into 
good loans and rein in predatory lenders. The bill authorizes FHA to 
offer loans with little or no down payment and directs it to approve 
loans to borrowers with higher credit risk than is currently allowed. 
These measures will enable FHA to compete with the introductory teaser 
rates advertised by subprime lenders.
  The bill will raise the single-family loan limit, enabling families 
who live in more expensive areas, such as California, to qualify for 
FHA-backed loans. The FHA has virtually no presence in expensive areas 
where the average price of a home already exceeds the FHA loan limit. 
Increasing access to FHA-backed loans will give many thousands of our 
constituents the stable financing terms that they need to keep up with 
their payments and stave off foreclosure.
  Furthermore, this bill offers relief to our seniors. Seniors are 
often targeted by subprime loans, especially for reverse mortgages. 
Seniors who own their homes but who have limited financial resources 
might need to mortgage their homes to pay for other expenses. This bill 
eliminates the cap on FHA reverse mortgages to meet with growing needs 
of our seniors in tight financial times.
  Finally, the legislation directs surplus FHA funds to a housing 
counseling program as well as to an affordable housing fund. In this 
way the legislation will ensure that borrowers have the opportunity to 
achieve the dream of owning a home as well as to become educated about 
their mortgage options and what it will mean in the long term.
  The mortgage lending troubles are getting out of control. This bill 
will take an important first step toward reining in a disturbingly high 
rate of foreclosure. Later this week Chairman Frank will hold a hearing 
with Federal Reserve Chairman Bernanke and other administration 
officials to look for additional legislative and regulatory solutions 
to this growing problem. Ensuring that FHA lending policies are up to 
date and competitive in the current market is a good start.
  This bill will ensure that our fellow Americans have better federally 
backed choices to buy a home. This bill will curtail the spread of 
subprime lending and get more of our homeowners into mortgage loans 
with stable interest rates and transparent terms. This is a step in the 
right direction.
  This is a bipartisan issue. The House passed similar legislation in 
the 109th Congress. This bill expands upon that legislation, reflective 
of the growing crisis. We need to pass this bill. Our constituents need 
this bill to keep their homes, and we need to work with our colleagues 
in the Senate to get this bill to the President.
  I look forward to the debate on the Expanding Homeownership Act and 
hope that my colleagues on both sides of the aisle will join me in 
supporting this rule and the underlying bill.
  Mr. Speaker, I reserve the balance of my time.
  Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
  I rise in reluctant opposition to this unnecessarily restrictive rule 
and to a number of the provisions included in the underlying 
legislation in its current form. While I appreciate and support the 
committee's effort to provide for the safety and soundness of our 
Nation's housing financial system and our broader financial system, 
this legislation has a number of avoidable shortcomings, and I hope 
that at least some of them would be corrected during the restrictive 
amendment process provided for by this rule.
  The Federal Housing Administration was created by the National 
Housing Act of 1934 to broaden homeownership, protect lending 
institutions, and to stimulate the home construction industry. In 
addition to providing stability and liquidity to the mortgage market, 
the FHA's efforts have led to the creation of the 30-year mortgage 
product and mortgage instrument standardization, both of which have 
contributed to the growth of our modern housing financial marketplace. 
And, as one of the very few Federal Government agencies to operate 
entirely on fees derived from the program, the FHA has accomplished all 
of this with no taxpayer dollars or subsidy.
  The legislation that has been brought to the House floor today 
includes a number of important modernization provisions that will help 
American families across this country to own their own homes, like: 
increasing the FHA loan limit for high-cost areas, providing for 
flexible down payment requirements, simplified and improved condo loan 
requirements, and an expansion of the ability to utilize home equity 
conversion mortgages.

[[Page 24520]]

  This bill closely mirrors H.R. 5121, Republican legislation that 
passed overwhelmingly last Congress, and would also supplement the FHA 
Secure Initiative unveiled by President Bush at the end of August. This 
program, which is aimed at borrowers who have fallen behind on their 
payments after a mortgage rate reset, is projected to help a quarter of 
a million families over the next year. By helping first-time, owner-
occupied home buyers refinance into mortgages that they can afford, 
this already implemented program will help families and stabilize 
communities, while targeting this support to the real families in need 
and away from speculators who do not need help from the Federal 
Government.
  Unfortunately, despite all the positive elements included in this 
legislation, I do believe that this bill could be vastly improved. 
Chief among the problems with this legislation is its establishment of 
a new line of income for a poorly defined affordable housing grant fund 
linked to increased FHA receipts. FHA receipts are already recognized 
for future budgeting purposes to help determine subsequent affordable 
housing program appropriations at HUD, with any extra revenue from 
these programs deposited in the U.S. Treasury as a benefit to 
taxpayers. This legislation would divert this revenue to a housing fund 
with a poorly defined mission, reducing resources available for other 
existing HUD programs that already assist low-income families and 
individuals.
  I believe it is bad public policy to tie the fate of families that 
need housing support to the success or failure of the FHA to bring in 
surplus revenue. Even worse, because the affordable housing funds would 
come from fees related to conforming loans and reverse mortgages, this 
bill levies a new stealth tax on the most modest home buyers and on 
seniors without even disclosing to them the costs associated with this 
new Federal mandate.
  Other problems with H.R. 1852 include its failure to provide the FHA 
with the flexibility needed to implement risk-based pricing, which 
limits consumer choice as well as the FHA's ability to help additional 
home buyers. This bill's proposed 2 percent limit on home equity 
conversion mortgage loan origination fees proposed in the legislation, 
which attempts to protect senior citizens from potentially abusive 
lending practices, may also unnecessarily limit choice and flexibility 
in a changing marketplace.
  Mr. Speaker, I would like to thank committee ranking Republican 
Spencer Bachus; subcommittee ranking Republican Judy Biggert; and the 
incoming ranking Republican on the Housing and Community Opportunity 
Subcommittee, my former Rules Committee colleague, Shelley Moore 
Capito, for all their hard work on this legislation.
  Mr. Speaker, I will also insert in the Congressional Record the 
Statement of Administration Policy regarding this legislation and would 
like to take this opportunity to thank two people for their hard work 
from the White House, White House aides Chris Frech and Marty 
McGuinness, who have provided important information not only on this 
but worked with Members to make sure that they understood the White 
House's position on this issue.
         Executive Office of the President, Office of Management 
           and Budget,
                               Washington, DC, September 17, 2007.

                   Statement of Administration Policy


 H.R. 1852--Expanding American Homeownership Act of 2007 (Rep. Waters 
                       (D) CA and 13 cosponsors)

       The Administration supports legislation to modernize and 
     reform the National Housing Act (NHA) and to ensure that the 
     Federal Housing Administration (FHA) continues to play a key 
     role in serving low- and moderate-income homebuyers. The 
     President has called on Congress to expeditiously pass the 
     Administration's FHA Modernization bill to assist more 
     homeowners during this period of stress in the mortgage 
     markets. H.R. 1852, as reported by the House Financial 
     Services Committee, includes provisions that are essential to 
     maintaining FHA's core mission of expanding homeownership 
     opportunities for borrowers who are underserved, or not 
     served, by the existing conventional mortgage marketplace. 
     The legislation makes critical improvements to the statutory 
     scheme of the NHA, and these improvements have also been 
     proposed by the Administration. Nonetheless, the 
     Administration has a number of significant concerns with H.R. 
     1852, which the Administration looks forward to addressing 
     with Congress as the bill moves through the legislative 
     process.
       As proposed by the Administration, the legislation 
     authorizes an increase in FHA loan limits from $362,000 to 
     $417,000 or 100 percent of the Federal Home Loan Mortgage 
     Corporation (Freddie Mac) conforming loan limit in high-cost 
     areas, and from $200,000 to $271,000 in lower-cost areas. 
     These changes are needed to adapt the program to increasing 
     home prices. The Administration strongly opposes amendments 
     that would authorize FHA guarantees of loans greater than the 
     conforming loan limit as the program should remain targeted 
     to traditionally underserved homebuyers, such as low- and 
     moderate-income families.
       Additionally, the legislation authorizes FHA to utilize 
     risk-based premium pricing to more appropriately match 
     premiums to borrower risk, based on measures such as the size 
     and source of their downpayment and their credit scores. 
     Consistent with current mortgage lending practices, the 
     legislation includes the option to extend the maximum 
     mortgage term from 35 to 40 years. Finally, with respect to 
     FHA's Home Equity Conversion Mortgage (HECM) Program, the 
     legislation removes the statutory volume cap on the number of 
     reverse mortgages that may be insured by FHA, while 
     permitting HECMs for use in condominium units and purchase 
     transactions. Each of these improvements enables FHA to serve 
     a larger number of targeted homebuyers, in more areas of the 
     nation, than are being served under the present program.
       While the Administration strongly supports Federal 
     assistance to individuals and families that lack the means to 
     afford adequate housing, the Administration strongly opposes 
     the establishment of a new Affordable Housing Grant Fund 
     linked to increased FHA receipts. FHA receipts are already 
     credited toward HUD appropriations and a new program that 
     attempts to divert this revenue would reduce resources 
     available for other HUD programs that assist low income 
     families and individuals. Furthermore, tying financing for 
     the fund to FHA receipts would be counter-productive since 
     FHA receipts annually fluctuate based on housing market 
     conditions and bear little relation to any potential program 
     funding needs. Many of the proposal's details are also 
     undefined and unclear; therefore, the specifics may raise 
     additional policy concerns.
       The Administration strongly supports flexible downpayment 
     options, but opposes a provision in H.R. 1852 that limits 
     their benefits to first-time homebuyers. Such a limitation 
     would hinder the ability of some current homeowners to 
     refinance into an FHA-insured loan. By removing this 
     limitation, FHA could help provide existing homeowners with 
     additional flexibility in managing the mortgage debt.
       The Administration also has concerns that H.R. 1852 does 
     not provide FHA with the necessary flexibility to implement 
     risk-based pricing, thereby limiting consumer choice as well 
     as FHA's ability to help additional borrowers. H.R. 1852 
     fails to raise the statutory cap on annual premiums from 55 
     to 200 basis points, nor does it permit caps on upfront and 
     annual premium combinations that would allow FHA to offer 
     borrowers a variety of premium structures. In addition, the 
     provision for mandatory refund of ``excess'' premium to 
     borrowers with FICO credit scores below 560 whose loans 
     survive more than five years undercuts the insurance 
     principle on which FHA is based. This provision also hampers 
     FHA's ability to serve a greater number of the borrowers this 
     provision is purported to benefit. Because of these 
     provisions, H.R. 1852 would lower receipts by approximately 
     $75 million relative to the President's budget.
       Generally, the Administration supports the provision in 
     H.R. 1852 that permits an increase in mortgage insurance 
     premiums if HUD determines that, absent such an increase, the 
     insurance of additional mortgages would require the 
     appropriation of new budget authority to cover the costs of 
     such insurance. However, the requirement to do so by 
     rulemaking is process-laden and onerous and would 
     significantly delay and hamper HUD's ability to respond to a 
     changing market. The Administration will work with Congress 
     to establish a process that efficiently and effectively 
     allows HUD to increase mortgage insurance premiums as needed.
       The Administration also has concerns with the two percent 
     limitation on HECM loan origination fees proposed in the 
     legislation. Although the Administration applauds the attempt 
     to protect senior citizens from potentially abusive and 
     predatory lending practices, any such limitations should be 
     flexible enough to respond to a changing market. Accordingly 
     the Administration believes that such limitations should be 
     set by the FHA through Federal Register notice or other 
     appropriate vehicle.
       In addition, the Administration is concerned that the Act 
     revises certain recently enacted asset disposition reforms 
     for FHA multifamily programs. This would reduce receipts by 
     nearly $40 million. The Administration is also concerned 
     about a provision that

[[Page 24521]]

     would make it possible for correspondent lenders to use FHA 
     without meeting audit and net worth requirements, which could 
     allow participation by brokers who are inadequately 
     capitalized or have internal control difficulties.
       The Administration remains committed to modernizing and 
     reforming FHA, and looks forward to continuing to work with 
     Congress to ensure that concerns are addressed and that the 
     necessary reforms are part of any final legislation.

  Mr. Speaker, I reserve the balance of my time.
  Ms. MATSUI. Mr. Speaker, I yield myself such time as I may consume.
  Before yielding to my next speaker, I would like to point out that 
the bill directs surplus funds to an affordable housing fund. This is 
an appropriate use of any net FHA funds. The surplus funds are directed 
to a source that is consistent with the mission of this legislation: to 
help Americans buy homes through federally backed means.
  However, for those Members who do not support this fund, I want to 
point out that there is an amendment made in order to strike the fund. 
All Members of this House will have an opportunity to vote on this 
important issue.
  With that, Mr. Speaker, I yield 4 minutes to the gentlewoman from 
Ohio (Ms. Sutton), a member of the Rules Committee.
  Ms. SUTTON. Mr. Speaker, I thank the gentlewoman for her leadership 
on this issue and on this rule.
  Mr. Speaker, I rise in favor of this rule and in strong support of 
the underlying legislation, the Expanding American Homeownership Act.
  Owning a home in this country is called the American Dream for many 
reasons: the pride of ownership, a sense of responsibility, the feeling 
of settling down and belonging to a community and a neighborhood. But 
the American Dream is in peril for many families in this country as 
foreclosures rise and dreams shatter.
  I am sorry to report, Mr. Speaker, that in my home State of Ohio, we 
have the Nation's highest rate of mortgages that are seriously 
delinquent or in the foreclosure process. In April of this year, Ohio 
had nearly 12,000 default notices, auction sale notifications, and bank 
repositions. Sadly, one in ten Ohio homeowners with a mortgage is at 
least a month behind in payments and one in four with a subprime loan 
is delinquent or in foreclosure.
  These staggering statistics are not just numbers. They are families 
and individuals whose American Dream is quickly becoming a nightmare. I 
have talked with many hardworking, proud families who are struggling to 
pay their mortgages and afford health insurance, struggling to put food 
on the table and pay for their children's college education. They are 
working hard and they are playing by the rules, but nonetheless the 
American Dream has moved out of their reach.
  The homeownership crisis is part of a larger problem for our Nation 
where policies and laws have not worked for our low- and middle-class 
families the way that they should. This is unacceptable for my 
constituents, and it should be unacceptable for a Nation built by 
working men and women that prides itself on ownership, responsibility 
and fairness.
  Mr. Speaker, the problems in the housing market are not new, but they 
have become what they are because of a lack of action and leadership 
from prior Congresses and this administration. The lack of oversight 
has led to the abuse of a mortgage system by unscrupulous lenders and 
others looking for easy profit by preying upon those who are most 
vulnerable. And it is wholly unacceptable that a system that should be 
an avenue to homeownership has instead become a path to heartache for 
far too many families.
  Today by passing the Expanding America Homeownership Act, we take a 
bold step forward on what is going to be a long road to fix this broken 
system.

                              {time}  1045

  H.R. 1852 raises loan limits, helps reduce the burden for high-risk 
borrowers, expands counseling for home buyers, and provides new 
ownership incentives for low-income families. And these are very 
important and positive measures.
  This is a demonstration of our commitment to restore the American 
Dream, but we also understand that there is no easy fix for this issue. 
In coming days, I plan to introduce legislation that will bring 
together many interests and groups involved in foreclosure and mortgage 
lending crisis so that we can continue to act to improve this 
situation. I hope that, working together, we will be able to quickly 
offer comprehensive and meaningful solutions to move forward.
  A similar effort has been made in Ohio spurred by our new Governor, 
Ted Strickland. And just recently, they came back with some very 
important recommendations that will hopefully make a meaningful impact 
in the State. But we here in Congress at the Federal level need to do 
our part.
  Mr. Speaker, never again do I want to have to hear that a family has 
lost their home simply because our laws and regulations have worked 
against them.
  I urge passage of this rule and the underlying legislation.
  Mr. SESSIONS. Mr. Speaker, at this time, I would like to yield 5 
minutes to the gentlewoman from Illinois (Mrs. Biggert).
  Mrs. BIGGERT. I thank the gentleman for yielding.
  Mr. Speaker, today I rise in opposition to this rule governing the 
consideration of H.R. 1852, the Expanding American Homeownership Act of 
2007.
  I had hoped that the committee would see the wisdom in providing an 
open rule to this important legislation; and in the absence of an open 
rule, that it would at least make in order those amendments that the 
Members took the time and effort to draft, including one of my own 
amendments. Unfortunately, only some of the amendments filed with the 
Rules Committee were made in order.
  While I'm pleased that some of these amendments made in order are 
Republican amendments, other amendments which were offered and debated 
during our committee markup of this bill were not made in order. These 
amendments deserve to be debated and given a fair hearing.
  Mr. Speaker, last year FHA's modernization bill, which passed the 
House by a vote of 415-7, garnered broad bipartisan support. This 
year's bill does not have that kind of support. I am pleased that the 
majority has edged closer to last year's bipartisan bill since the 
introduction of the new bill under consideration today.
  As I pointed out during our committee hearing and markup on this 
bill, the bill originally excluded homeowners seeking to refinance from 
benefiting from a modernized FHA. The bill will now assist more 
homeowners, perhaps some seeking to refinance a bad subprime loan, but 
still not as many as last year's bill.
  I continue to object to provisions that do not fully allow for risk-
based pricing. Again, witnesses during our committee hearings said this 
would result in FHA serving fewer, not more, American borrowers. I also 
remain opposed to the provision that siphons money away from FHA to 
fund a brand-new government program, another trust fund, to build more 
affordable housing. While this is a very important issue, affordable 
housing, what we need here is to have FHA money to help those that are 
in trouble, facing foreclosure, or those first-time borrowers who would 
not be able to find a good mechanism to find a mortgage.
  During committee deliberations, we were given the opportunity to 
debate and consider a variety of issues pertaining to this bill. 
Members on our side of the aisle had hoped that all Members, not just 
those on the Financial Services Committee, would be given the same 
opportunity to debate important issues on the House floor.
  Republicans support many aspects of this bill, H.R. 1852; but I think 
we all deserve the right to participate in the amendment process, 
whether as a member of the committee of jurisdiction, or as a Member of 
the U.S. House of Representatives. Only through an open rule is that 
possible. For this reason, I rise in opposition to the rule being 
considered today and urge my colleagues to vote ``no'' on this rule.
  Ms. MATSUI. Mr. Speaker, I yield myself such time as I may consume to

[[Page 24522]]

make a comment before yielding to my next speaker.
  I would like to point out that seven amendments were made in order. 
Two of the minority amendments offered were redundant changes, so one 
of those was made in order. And, finally, an amendment in the nature of 
a substitute offered by Mrs. Biggert was made in order. We are 
providing ample opportunity for debate and for Members to vote on the 
provisions of the bill.
  With that, Mr. Speaker, I yield 3 minutes to the gentleman from 
Oregon (Mr. Blumenauer).
  Mr. BLUMENAUER. I appreciate the gentlewoman's courtesy in permitting 
me to speak on this bill and appreciate her leadership, and 
particularly emphasizing the fact that the minority has the opportunity 
for a substitute to be offered up. So the House will have an 
opportunity to weigh the different approaches to determine what is 
truly in the best interests of American homeowners.
  I welcome this legislation today. I support the rule, and I support 
the underlying legislation. But I hope that this will be just the start 
of on-going progress for dealing with what is truly a housing crisis 
that is enveloping this country.
  While it's pleasant to read now that Alan Greenspan, as he's 
attempting to protect his role in history, now agrees that there were 
probably some mistakes that were made, not yet acknowledging the 
failure on the part of the Fed to step forward and deal meaningfully, 
using the powers that they had in the housing market. Today we see the 
consequences of that failure, of this Congress, a failure of being able 
to meaningfully deal with the protection of American homeowners.
  Foreclosures are mounting by the day, but we're only seeing the tip 
of the iceberg, because literally tens of thousands of people every 
week are going to be facing a situation where adjustable rate mortgages 
in the months ahead are going to be exploding in much higher rates, 
where people are going to be paying $200, $300, $400, $500 a month, or 
more, higher and be trapped into these unfair subprime loans. Where 
there is a clear pattern of abuse of lower income, less sophisticated 
buyers, it's time for us to put on the table more comprehensive 
approaches.
  Isn't it time to reconsider the draconian bankruptcy legislation that 
this House passed a few years ago? Maybe it is time to treat the 
homeowner, dealing with the most valuable asset most families have, 
their home, the same way that a business person who speculated in 
purchasing homes for investment purposes would be treated in 
bankruptcy. The speculative business person can readjust mortgage 
terms; they can negotiate interest rates in the amount of the loan. 
That is denied to homeowners.
  Maybe it's time to consider some consumer protections. If you buy a 
$40 toaster that explodes, there is a Federal agency that will protect 
you. But if you buy a financial instrument that has a one-in-four 
chance of exploding in the face of the buyer, putting at risk their 
number one asset, there isn't any similar protections.
  While I appreciate the legislation that's coming forward, I am 
hopeful that it is just the beginning of dealing with this ongoing 
problem.
  Mr. SESSIONS. Mr. Speaker, I was waiting for one additional speaker, 
and that gentleman has not showed up at this time. I would like to 
inquire of the gentlewoman if she has additional speakers, or where we 
may stand. If I could quickly engage the gentlewoman.
  Ms. MATSUI. Mr. Speaker, I am waiting for an additional speaker.
  Mr. SESSIONS. The gentlewoman is waiting for an additional speaker, 
and I appreciate that very, very much.
  Mr. Speaker, you know, we are here this morning, almost 11 o'clock in 
Washington, D.C. I don't know of much else we've got going here on the 
floor today. I think we're going to have four suspensions in addition 
to this bill, and yet last night the Rules Committee, our friends in 
the new Democrat majority, decided that they would shut down debate by 
having this rule without it being an open rule, shut out a number of 
amendments and Members who would choose to come down and debate things 
today. And so I'm disappointed that, in a day where really not much 
else is going on, that we could not include the full discussion and 
take this day to talk about affordable housing and where the ideas are 
that each and every Member might have on how we're going to increase 
homeownership and protect these homeowners.
  I find it interesting, however, with some of the speakers that we've 
had today, that just a few years ago we were, with full knowledge of 
this United States Congress, very pleased that homeownership was 
increasing all across America and that credit was being extended to a 
number of people, including lots of families who would have an 
opportunity to finally own their own home. And now we find out today 
that, in fact, it's a lot of people who are to blame, who are these 
greedy people who were the lenders, who were trying to get people and 
bring them in to buy houses when, in fact, it was the national will. It 
was a good thing that they would have, virtually at no cost down, an 
opportunity to come and be in a house. We heard testimony where people 
really could get in houses for cheaper than they could living in an 
apartment. So millions of Americans went and did that. And they 
willingly signed on the line, yes, I will take this low-cost loan right 
now, and in 5 years I will have to go to a market-based rate to borrow 
the money.
  This wasn't a mistake. This wasn't somebody being greedy. This was 
someone who was out offering an opportunity. And as all of us would 
have to predict the future, we don't know what the future would be, but 
it got people in homes, and now we do have some problems. And dealing 
effectively with the problem is, I think, what we should be remembered 
for, not looking back and saying what a bad idea it was to make sure 
that millions of families could get in their own homes.
  So I respectfully disagree with those that come to the floor here 
today to argue about greed and all these people who took advantage of 
these poor and low-income homeowners. I think it was a good thing. I'm 
sorry it has not worked out in every single case. But guessing what 
something is going to be like in 5 years means that you have a chance 
to plan and be prepared for it. And so now we will be judged on how 
well we do to make sure that we lessen the activity of the number of 
people who have to bail out of their houses because they can't afford 
them.
  Mr. Speaker, I reserve the balance of my time.
  Ms. MATSUI. Mr. Speaker, my remaining speakers are not here, so I am 
prepared to close if the gentleman from Texas is prepared to close.
  Mr. SESSIONS. Mr. Speaker, I had anticipated and hoped that the 
gentleman from Georgia (Mr. Price) might be here. I have been notified 
that he is in a meeting with constituents at this time.
  One of the amendments which Dr. Price brought to the Rules Committee 
yesterday, which the Rules Committee rejected on a party-line basis, 
was part of really the debate and discussion that I think needs to take 
place as we talk about taxpayer money being involved with housing in 
this country. And the amendment which was rejected by the new Democrat 
majority universally across the line, every single Democrat said, no, 
they did not want to hear the debate on this, and it is as follows: The 
amendment said that it would require that any individual or household 
receiving money from the affordable housing fund must present 
verification of legal residency by a secure identification document.
  Mr. Speaker, let's be forthright about this. We have had discussion 
after discussion, debate after debate about health care, about public 
housing, about housing funds, of virtually every single topic that we 
get into here on the floor of the House of Representatives where we 
believe, the Republican Party believes, that people who are seeking 
assistance and help from funds, whether it be taxpayers or public 
systems like this that do utilize the attributes of the government, 
that there should be a verification that somebody

[[Page 24523]]

is in this country legally and has legal status.
  Mr. Speaker, repeatedly this new Democrat majority, whether it's for 
health care or whether it's now for this new housing fund, they do not 
want to require that someone even has to present verification of who 
they are. And we disagree with that. And I am sorry that the Rules 
Committee made a determination and the Democratic Party decided that 
they do not want to have to have anyone present verification of who 
they are or that they are in this country legally.

                              {time}  1100

  We disagree with that. I am sorry that the Rules Committee did not 
allow that in order for the gentleman, Mr. Price, to be able to argue 
that as part of the debate today.
  So, Mr. Speaker, I will be voting ``no.'' I will be voting ``no'' on 
this rule because I believe that what this new Democrat majority did 
was to shut down debate even in a day when we have lots of time to get 
the best ideas on the floor and to make sure that every single Member 
can be heard from.
  Mr. Speaker, I yield back the balance of my time.
  Ms. MATSUI. Mr. Speaker, before I close, I just want to make a 
comment that H.R. 1852 already has strong identification requirements 
for those applying for FHA-backed mortgage insurance.
  With that, Mr. Speaker, we know that our housing market is in severe 
distress. We must ensure that subprime mortgage lending is not putting 
our residents at risk. Subprime mortgages can be a very useful tool 
enabling those with imperfect credit to qualify to buy a home. Reining 
in predatory lending practices will help our families keep those homes 
that they have worked so hard to buy. The Expanding American 
Homeownership Act will ensure that FHA has the tools it needs to get 
more home buyers into good loans.
  This bill will bring the FHA regulations up to date. It will provide 
the agency with the ability and resources to offer a broader diversity 
of loans to meet the needs of the current market. This is an important 
bill that will give more of our constituents access to solid federally 
backed loans. That is a kind of stable financing that homeowners need 
to get through the rocky times our real estate market is weathering.
  The Financial Services Committee has worked very hard to get this 
bill to the floor. I hope that we can keep it moving forward. I hope 
that my colleagues will join me and show strong bipartisan support for 
the rule before us and the underlying bill.
  Mr. Speaker, I yield back the balance of my time, and I move the 
previous question on the resolution.
  The SPEAKER pro tempore (Mr. Holden). The question is on ordering the 
previous question.
  The question was taken; and the Speaker pro tempore announced that 
the ayes appeared to have it.
  Mr. SESSIONS. Mr. Speaker, on that I demand the yeas and nays.
  The yeas and nays were ordered.
  The SPEAKER pro tempore. Pursuant to clause 8 of rule XX, further 
proceedings on this question will be postponed.

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