[Congressional Record (Bound Edition), Volume 154 (2008), Part 13]
[Extensions of Remarks]
[Page 17945]
[From the U.S. Government Publishing Office, www.gpo.gov]




     AMERICAN HOUSING RESCUE AND FORECLOSURE PREVENTION ACT OF 2008

                                 ______
                                 

                            HON. TODD TIAHRT

                               of kansas

                    in the house of representatives

                         Friday, August 1, 2008

  Mr. TIAHRT. Madam Speaker, owning a home is an essential component of 
the American dream, and an accomplishment that millions of Americans 
aspire to and take pride in. In recent months, however, the housing 
market has entered a slump. The effort to provide a way for all 
Americans to own their own homes brought a sharp increase in the usage 
of subprime and exotic mortgages, which proved to be more than the 
market could handle. We now find ourselves grappling with decisions on 
how best to ``fix'' the problems that have arisen in the housing market 
and in our economy.
  However, a potential $300 billion Government handout, such as what 
has been proposed in this legislation, is not the answer. Congress has 
been given a real opportunity to reform Government Sponsored 
Enterprises, GSEs, and eliminate the threat to the housing market. 
Unfortunately, however, the authors of this legislation have chosen to 
reject real reforms and instead only include ridiculous amounts of 
bailout spending. By extending an unlimited line of credit to Fannie 
Mae and Freddie Mac until 2009, we are placing American taxpayers at 
risk by absorbing the losses of these for-profit institutions. The bill 
further institutes a tax on the very GSEs that we are being asked to 
prop up, and allows that money--an estimated $9 billion over 10 years--
to be given to supposed ``housing and development'' groups that have 
been shown to participate in illegal and unethical activities, such as 
widespread voter fraud. The Congressional Budget Office, CBO, has 
estimated that the expected value of the Federal budgetary cost from 
enacting this proposal would be $25 billion over fiscal years 2009 and 
2010, but that this figure could rise into the hundreds of billions of 
dollars. I believe this legislation will further exacerbate our 
nation's rising deficit and further weaken our already ``weak dollar.''
  While there is no doubt the housing slump must be addressed, I am 
concerned by the precedent of using taxpayer dollars to bail out 
fraudulent lenders and, in some cases, irresponsible borrowers. 
Congress can enact responsible, market-based legislation to address our 
housing needs. I fully support FHA and GSE reform measures, yet I 
cannot support a massive bailout to irresponsible lending practices and 
market speculators. For these reasons, I voted against H.R. 3221.
  I remain committed to supporting measures that provide the necessary 
relief to families who have been victimized without burdening taxpayers 
for the irresponsibility of others. Therefore, I have given my support 
to two alternative bills introduced before the House of Representatives 
that precisely address the needs of homeowners in a responsible and 
fair way.
  First, H.R. 5974, the Housing Opportunity for All Americans Act of 
2008, addresses the housing slump in a responsible way. For instance, 
this bill does not include $300 billion in funding to the Federal 
Housing Authority. Instead of providing a massive bailout to 
irresponsible lenders and borrowers, this legislation creates a market 
incentive approach to the housing slump. The market approach includes a 
one-time tax credit for homebuyers of 10 percent of the home's purchase 
price, up to $10,000, for 1 year after the enactment of the bill. Also, 
under this legislation, taxpayers who are nonresident aliens, those who 
flip a home within the 1 year period, or people who sell a house to a 
relative simply for the credit, would not be eligible. Furthermore, 
mortgages which exceed the maximum original principal obligation of a 
mortgage Freddie Mac will purchase would not qualify.
  Second, the Homeownership Protection and Housing Market Stabilization 
Act of 2008, H.R. 5857, is a more responsible approach to addressing 
the current issues facing the housing market and the underlying causes 
of the problem. The bill includes provisions to directly protect 
homebuyers and owners, such as housing counseling, improved disclosure 
practices, fraud combating and prevention measures, and encouragement 
to rework loans instead of foreclosing. It also aims to help prevent 
lenders from falling into the same habits that have recently developed 
in the industry by providing liability protection for helping troubled 
borrowers, requiring escrow accounts for subprime borrowers, and 
reforming appraisal practices for prospective homebuyers. In addition, 
this legislation contains provisions similar to those that have passed 
this House with my support: FHA modernization and improved regulation 
of GSEs, including Fannie Mae, Freddie Mac, and the Federal Home Loan 
Banks.
  These alternative bills provide the integrity of the appraisal 
process and strengthen mortgage fraud prevention efforts that will help 
bring stability to the current housing market. These bills together 
represent a viable alternative, offering an appropriate response to a 
serious problem without burdening taxpayers for the irresponsibility of 
others. I hope this body has the chance to consider these important 
provisions in the immediate future.

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