House Set Next Week To Markup Bipartisan Downpayment Assistance Bill

Washington, DC — September 11, 2008
By: On The Hill Blog

Lawmakers the House Financial Services Committee intend next week to markup H.R. 6694, a bill to reauthorize and reform a downpayment assistance program funded in part by home sellers, according to an organization that supports the measure.

The Bush administration banned the program in July after it helped more than 1 million low and moderate income families and individuals buy their own homes since 2000, says the non-profit organization, AmeriDream Inc.

"Support for H.R. 6694 in Congress is gaining steam," says Ann Ashburn, president of AmeriDream. "This is encouraging news, and the credit goes to the 32,000 Americans who called on leaders in Washington to protect downpayment assistance. However, our work is far from over. I encourage the public to contact their representatives in both the House and the U.S. Senate and tell them that a vote for H.R. 6694 is a vote for the next generation of homeowners."

H.R. 6694, sponsored by Rep. Al Green (D-Texas), would reinstate Federal Housing Administration (FHA) seller downpayment assistance for persons with certain credit scores. H.R. 6694 is co-sponsored by Reps. Maxine Waters (D-Calif.), Gary Miller (R-Calif.), and Christopher Shays (R-Conn.).

The Green-Miller-Waters-Shays plan would make non-profit downpayment assistance an allowable gift source for FHA borrowers, AmeriDream says. The bill further seeks to ensure that providers of the downpayment assistance operate in a transparent manner to guard against conflicts of interest, it says. It also includes language to ensure that FHA maintains its financial stability by permanently authorizing the Department of Housing & Urban Development to assess higher premiums to higher risk borrowers, AmeriDream adds.

The working families who have used the downpayment assistance programs that HR 6694 would reauthorize qualify for FHA-insured loans in every respect, but are unable to save the needed downpayment, AmeriDream says. AmeriDream says it has provided more than 250,000 gifts to aspiring homeowners, approximately 80 percent of whom were first-time homebuyers. AmeriDream says it also has helped educate 60,000 homebuyers through homebuyer education courses, helped 1,200 homeowners retain their homes when confronted with mortgage difficulties, and committed more than $30 million to affordable housing development in local communities.

Homebuyers who received the benefit of downpayment assistance were able to obtain a safe FHA-insured loan and avoid the risky subprime loans that were the source of the mortgage meltdown that has resulted in record foreclosures, AmeriDream says.

"Congress has the power to mend -- not end -- downpayment assistance funded in part by sellers," says Green. "More than 100,000 hard-working families and individuals, many of them women and minorities, depend on these programs annually to become homeowners. I introduced this bipartisan legislation to preserve access to homeownership while protecting the FHA's solvency. I thank my colleagues, Financial Services Chairman Barney Frank, Housing Subcommittee Chairwoman Maxine Waters, and Reps. Gary Miller and Christopher Shays, for their support of this important legislation and for recognizing that the next generation of homeowners is counting on this program."

The Financial Services markup of HR 6694 is scheduled for Tuesday, Sept. 16.

In addition to AmeriDream, the bill is supported by a broad coalition of supporters, including the National Association of Homebuilders, the Labor Council for Latin American Advancement, and the U.S. Conference of Mayors, the Congressional Black Caucus, and the Congressional Hispanic Caucus.

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For additional information, please contact Shelley Mitchell, smitchell@nehemiahcorp.org, 916-231-1999.

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