Washington, D.C. – U.S. Senators Patty Murray (D-WA) and Charles E. Schumer (D-NY) pledged to renew their push to add $100 million in mortgage counseling funds to the Senate's housing bill, even after Senate Republicans blocked their initial attempt tonight.
Murray and Schumer's proposal, which was co-sponsored by Senator Sherrod Brown (D-OH) and Robert Casey (D-PA), assists non-profits specializing in foreclosure prevention. An estimated two million families are at risk of losing their homes to foreclosure over the next two years as their risky subprime loans reset to higher, unaffordable rates.
"For families at risk of losing their home, this funding would have meant free, effective counseling no more than a phone call away. It’s time for Americans to pick up the phone and tell their Republican senators to stop blocking true relief for millions of struggling homeowners,” Murray said.
“Cutting these funds will significantly lessen the impact of the Senate's housing bill. It's a case of mixed-up priorities when we can find consensus on providing $6 billion in relief for homebuilders, but not a fraction of that for homeowners," Schumer said.
Counseling programs have a demonstrated track record in helping homeowners navigate the complicated process of contacting lenders, banks and legal services to modify their mortgage loans and ultimately save their homes from foreclosure. Counseling has proven to be one of the most successful and cost-effective ways of avoiding foreclosure, with a 96% foreclosure avoidance success rate. Foreclosure prevention counseling can cost $1,000 to $1,500 per household assisted, according to counseling groups. Conversely, the Joint Economic Committee of Congress, chaired by Schumer, has estimated that a typical foreclosure can cost up to $227,000.