Too many communities in Washington state have a chronic lack of affordable housing, which forces many working and fixed-income families to live miles from work or needed services just so they can afford rent or a mortgage. This is stressful for families, employers, and our infrastructure. And as Chair of the Senate Transportation and Housing Appropriations Subcommittee, I have worked to help communities in Washington state – and across the country – provide a range of affordable housing options.
Community Development Block Grants
The Community Development Block Grant (CDBG) program supports local efforts to revitalize communities and create jobs and economic development in underserved neighborhoods. I have been a longtime supporter of the CDBG program, which has helped struggling communities throughout our country. As chair of the Transportation and Housing Appropriations Subcommittee, I worked hard to fight off repeated efforts by the Bush Administration to cut CDBG funds, and I successfully increased funding for the program to ensure that the federal government continues to be a strong partner in investing in our communities’ infrastructure and housing needs. And I believe the CDBG program is an important tool to help revitalize communities hurt by the foreclosure and economic crises.
The housing market is at the heart of our economic crisis, and we will not fully recover until we can stop the wave of home foreclosures and restore stability to our neighborhoods and communities. As chair of the Transportation and Housing Appropriations Subcommittee, I have been working since early 2007 to analyze proposals to help stem the tide of home foreclosures and identify ways to reform and modernize the Federal Housing Administration (FHA).
Additionally, I have supported legislation to help struggling homeowners, increase the number of mortgage counselors available to help homeowners avoid foreclosure, reform and modernize government housing and mortgage agencies, and help communities reduce the concentration of foreclosures in their neighborhoods. As the mortgage industry and housing market continue to adjust to changes in the economy, I will continue to promote sound lending practices and responsible homeownership.
Federal Housing Administration
Government agencies, such as the Federal Housing Administration (FHA), must be reformed and modernized to in order to adequately meet the needs of today’s housing market. In many communities, home prices are higher than FHA loan limits, meaning FHA mortgages are not an option for many potential buyers. I supported a key proposal to raise the FHA loan limit to reflect the increase in home prices over the last several years, which will enable the FHA to live up to its mission of helping to increase homeownership. And I have supported legislation that would give the FHA resources to help as many as 400,000 homeowners refinance into more affordable and less risky mortgages. These reforms will help stabilize the housing market and help reduce foreclosures.
Foreclosure Prevention Act
Strengthening lending laws and increasing oversight of banking and financial institutions are essential to help us recover from the financial crisis and ensure that we do not repeat the mistakes that got us here in the first place. I have supported legislation that would reform lending practices and prevent borrowers from accepting terms they don’t understand and can’t afford. I also cosponsored S. 2636, the Foreclosure Prevention Act, to change bankruptcy law and enable some financially troubled families to keep their homes.
One of the most troubling things we learned from the foreclosure crisis was how many homeowners lack the basic skills needed to make good financial decisions. As a result, millions of homeowners signed mortgages they didn’t understand – and too many were taken advantage of by predatory lenders. All Americans should have the skills to make sound financial decisions, yet most of our K-12 schools don’t offer even basic financial literacy programs. We can and should do much more to help educate and protect the next generation of homebuyers and consumers.
In 2008, I introduced legislation that would make a substantial commitment to improving and expanding financial literacy programs. I reintroduced the bill in the 111th Congress. The bill, the Financial Literacy Improvement Act, would invest $250 million to support new personal financial education programs in K-12 schools and colleges. It would address the problems adults are facing today, while also helping to ensure that future generations have the skills to avoid the same mistakes.
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