Washington, D.C. - Congressman Dale E. Kildee (D-MI) joined his colleagues in passing legislation to help stabilize the housing market and to offer assistance to families at risk of foreclosure. The House of Representatives today passed comprehensive legislation designed to address the housing crisis and its spillover effects on financial markets and the broader economy.

Michigan has been among the states most affected by the current mortgage crisis and subprime lending abuses in recent years. According to PEW Charitable Trusts estimates, 30 percent of all loans in 2005 and 2006 in Michigan were subprime, and 1 in 36 Michigan homeowners are expected to experience foreclosure due to high-cost loans.

“The first step in turning around the economy is to stabilize the housing market. The housing crisis affects us all whether or not we are at risk of losing our homes,” said Kildee. “Michigan homeowners who were deceived or misled and are now confronted with foreclosure deserve a fair shot to refinance their loans.”

The House passed a measure to give the Federal Housing Administration $300 billion in new authority to insure refinanced lower-cost loans for borrowers. The House amendments to H.R. 3221, the American Housing Rescue and Foreclosure Prevention Act of 2008, would not offer a bail-out, but rather would require lenders and mortgage investors to take significant losses by reducing a loan’s principal. Borrowers, in order to participate, would be required to share with the Federal government any profit from the sale of a government guaranteed, refinanced home

The House also approved, by a vote of 239-188, H.R. 5818, the Neighborhood Stabilization Act of 2008. The bill would establish a $15 billion loan and grant program for the purchase and rehabilitation of owner-vacated properties. Rehabilitated properties would be resold to families at or below 140 percent of the State’s average median income.

“As homeowners in mid-Michigan are well aware, abandoned homes can dramatically suppress the value of neighboring homes, reduce tax revenue for schools and municipal services and provide havens for crime,” said Kildee.

Despite recent calls of Federal Reserve Chairman Bernanke for Congress to act to avoid preventable foreclosures, President Bush has threatened to veto H.R. 5818 and has withheld support of H.R. 3221.

To assist struggling homeowners through the current mortgage crisis, Kildee has made available on his congressional website and at his Michigan offices a Foreclosure Guide to federal, state and not-for-profit resources for free or low-cost foreclosure prevention programs.