AHAA - Association for Homeowners Across America
Protecting the American Dream

Just one week ago today, HUD proposed yet another rule in another effort to eliminate an essential tool available to first time homeowners and other low- to moderate-income individuals and families looking for some help with the required down payment to secure an FHA mortgage on a home of their own--Down Payment Assistance Programs.    These programs, operated by charitable organizations, have helped over 1 million homeowners in the past ten years; and HUD's latest ruling seeks to eliminate a program that operates without any government assistance, has generated over $10 billion in home equity, and has even been used by HUD itself to sell its own properties    Eliminating DPA programs would leave few options to qualified buyers who just need help with the downpayment.

While critics say that downpayments provided by DPA's are the cause of HUD's financial woes, I just don't buy it.  I'm surprised their latest proposal doesn't blame the sub-prime crisis on DPA programs.   In HUD's rationale for this latest proposal, they throw out sweeping generalizations that just don't play out in the very numbers they put up on their website. Homebuyers that need some assistance with a downpayment are not twice as likely to default--It may be slightly higher, but how is that offset with the increase in revenue that comes from increase in FHA production?    Plus, there is not substantiated evidence that buyers of homes insured using FHA with DPA have higher sales prices for their home than those in the same area without DPA

Just because FHA throws out these unsubstantiated assertions, doesn't make it true. They need to be stopped, and you can help. Take action now. Submit a comment through our website directly, and let your congressional representatives know how you feel about the rights of homeowners being trampled by this bureaucratic nonsense.

Brace yourself~~April is reported to be the single largest one-month volume of foreclosure activity, according to RealtyTrac, the online foreclosure sale site.   They have only been tracking data since 2005, but the trend is telling.   Reportedly there has been a 65% increase in activity from April 2007.   As if that is not bad enough, May and June of this year are supposed to be the peak of adjustable rate mortgage resets from the 2006 subprime loan frenzy.  I sure am glad we are not in a recession--At least that is what the President keeps telling us.

As the troubling statistics mount, homeowners facing resets need to be proactive.   If you think you're going to be in trouble, contact your lender NOW.   If you can't get help from your lender, contact Hope Now.   They have certified housing counselors to help.   But, whatever you do, do not just walk away.    Chances are your lender does not want your house, anymore than you want to leave it. 

With the expectation that the economy will not stabilize until 2009, homeownership is the linchpin that will govern the turnaround.    Every sector of our economy is impacted by defaults.    The House of Representatives have passed a bill that has measures to speed the recovery and help struggling homeowners.   Let your representative know how important you think these measures are.    Helping ailing homeowners is not a bailout; it is a vital effort that will be the key to turning this crisis around.

The house passed a Homeowner Aid package on Thursday designed to come to the rescue of a hobbling housing market and rescue troubled homeowners.   A key provision of the bill would provide struggling homeowners with new, reduced principle mortgages, insured by FHA.   

The Senate version of the bill, which is due out May 15, is likely to contain provisions that run contrary to the house language.   The differences will have to be ironed out as they two bills go to conference.  They will have their work cut out for them--President Bush has already promised to veto the legislation if it comes to him in its current form.

The bill, if enacted, will overhaul regulation of Fannie Mae, Freddie Mac, and the 12 Federal Home Loan Banks, in addition to modernizing FHA.   

Struggling homeowners need the relief promised by this legislation.     Each and every homeowner is affected by these defaults, not just the people losing their homes.  It is in everyone's interest to get this resolved in a way that keeps homes in the hands of their owners and not the banks.    In the long run, the banks don't want them and the homeowners are desperate to keep them.    Ultimately, the best solution is to work toward this end.