Helping Families Save Their Homes Act of 2009
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The Helping Families Save Their Homes Act was signed into law by President Barack Obama (D) in May 2009. The act amended the Hope for Homeowners Program, permitted lenders to modify loans without being held liable for certain losses, authorized the Secretary of Housing and Urban Development to pay the balance of modified Federal Housing Administration-insured loans, and expanded Federal Deposit Insurance Corporation coverage limits.[1]
Legislative history
The Helping Families Save Their Homes Act was introduced in the United States House of Representatives by Representative John Conyers (D) on February 23, 2009. The bill was referred to the House Financial Services Committee, the House Judiciary Committee, and the House Veterans' Affairs Committee. The House voted 234-191 in favor of the bill on March 5, 2009. On April 27, 2009, similar legislation was introduced in the United States Senate. On May 6, 2009, the Senate adopted this legislation by a vote of 91-5. On May 19, 2009, the House passed an amended version of the Senate bill by a vote of 367-54. That same day, the Senate approved the House amendments to the bill. President Barack Obama (D) signed the bill into law on May 20, 2009.[2][3]
Components
The act amended Chapter 13 bankruptcy law to allow lenders to modify existing loans without being held liable for certain losses. This provision protected lenders from liability when entering into loan modifications with borrowers.[1]
The act also amended the Hope for Homeowners Program by expanding the criteria for refinancing home loans. The Hope for Homeowners Program was a refinancing plan for homeowners who held variable-rate mortgages. The program permitted eligible homeowners to refinance these variable-rate loans into lower cost fixed-rate mortgages in exchange for entering into equity sharing agreements with the FHA.[4]
The law mandated credit counseling requirements for certain debtors. The legislation placed a moratorium on housing foreclosures until the foreclosure mitigation provisions of the act were functional.[1]
Under the law, the increased Federal Deposit Insurance Corporation coverage limit (from $100,000 to $200,000) was extended to December 31, 2013. This expansion was first implemented on a temporary basis by the Emergency Economic Stabilization Act. Later legislation further extended the coverage increase.[1]
Debate
Supporters of the act argued that it helped prevent foreclosures and allowed homeowners to keep homes they otherwise would have lost. On May 20, 2009, the day he signed the Helping Families Save Their Homes Act and Fraud Enforcement and Recovery Act into law, President Barack Obama (D) said the following:[5]
| “ | These landmark pieces of legislation will protect hardworking Americans, crack down on those who seek to take advantage of them, and ensure that the problems that led us into this crisis never happen again.[6] | ” |
| —President Barack Obama | ||
Opponents argued that some of the law's provisions would worsen existing home finance and foreclosure problems, and that the bill acted as a subsidy for those who bought homes they could not afford. Mike Pence (R), a member of the House at the time of the bill's passage, criticized the act, saying the following:[7]
| “ | It's legislation that really will punish those who played by the rules, lived within their means, by forcing them to subsidize Americans who made irresponsible choices. This bill also throws good money after bad. [...] More than anything else, Mr. Speaker, we are witnessing a disturbing pattern here in Washington, one that rewards bad decisions at the expense of people that have made right choices. We saw it in the bailout of Wall Street under a prior administration and continued under the new one.[6] | ” |
| —Representative Mike Pence | ||
See also
External links
Footnotes
- ↑ 1.0 1.1 1.2 1.3 Government Publishing Office, "Helping Families Save Their Homes Act of 2009," accessed January 15, 2017
- ↑ GovTrack, “S. 896 (111th): Helping Families Save Their Homes Act of 2009," accessed November 15, 2016
- ↑ Office of the Clerk, "Final Vote Results for Roll Call 104," accessed January 15, 2017
- ↑ U.S. Department of Housing and Urban Development, "Regulatory Impact of Implementing 'Helping Families Save Their Homes' Act," accessed February 2, 2017
- ↑ The White House, "Reforms for American Homeowners and Consumers: President Obama Signs the Helping Families Save their Homes Act and the Fraud Enforcement and Recovery Act," May 20, 2009
- ↑ 6.0 6.1 Note: This text is quoted verbatim from the original source. Any inconsistencies are attributable to the original source.
- ↑ Vote Smart, "Providing for Consideration of H.R. 1106, Helping Families Save Their Homes Act of 2009," accessed February 2, 2017
