House members urge Obama to act on housing

More than two dozen California House Democrats – including almost the entire Bay Area delegation, and led by three Bay Area members – have urged President Barack Obama to make a recess appointment that could bring a national mortgage-refinancing wave which in turn could stave off countless foreclosures.

Reps. Anna Eshoo, D-Palo Alto; Zoe Lofgren, D-San Jose; and Mike Thompson, D-Napa led the effort to convince the president to appoint a new director to the Federal Housing Finance Agency, which oversees mortgage backers Fannie Mae and Freddie Mac; the FHFA has been without a permanent director for two and a half years.

“Republicans in the Senate have been playing games with the American people by blocking the Federal Housing Financial Authority from having a proper leader,” Lofgren said in a news release. “These are difficult times and we need to be doing everything we can to prevent foreclosures and keep families in their homes. I urge President Obama to take immediate action and appoint a permanent director.”

As the Washington Post’s Ezra Klein blogged yesterday, there’s some bipartisan consensus that “the agency could write the rules so that anyone with a loan backed by Fannie and Freddie and current on their payments for six months would be automatically approved for refinancing.”

“The effect on the economy would be twofold: First, the refinancings would act like a high-powered tax cut for those homeowners who took advantage of them,” Klein wrote. “As Hubbard and Mayer write, ‘Empirical evidence suggests that consumers spend a larger portion of permanent increases in income than temporary increases.’ And as these refinancings would lower payments, they’re as permanent as you can get in government policy. Second, it would make the Fed’s efforts to keep interest rates low more effective in stimulating the economy.”

More than two million California homeowners are considered “underwater” because they owe more on their homes then their homes are worth; that’s about three in 10 of all California homes with mortgages.

Eshoo today said the national economy “cannot fully rebound unless and until housing is addressed. The current situation of foreclosures is unacceptable.”

Rep. Jerry McNerney, D-Pleasanton, issued a release noting this region has been disproportionately affected by the financial and housing crises.

“Families are faced with foreclosures, even as unemployment remains high. We can’t wait to have leadership to help folks stay in their homes,” he said. “Keeping folks in their homes is critical to the economic health of our communities. More has to be done to give people a clear path to avoiding foreclosure.”

The only Bay Area House member who didn’t sign the letter was House Minority Leader Nancy Pelosi, D-San Francisco.

Josh Richman

Josh Richman covers state and national politics for the Bay Area News Group. A New York City native, he earned a bachelor’s degree in journalism from the University of Missouri and reported for the Express-Times of Easton, Pa. for five years before coming to the Oakland Tribune and ANG Newspapers in 1997. He is a frequent guest on KQED Channel 9’s “This Week in Northern California;” a proud father; an Eagle Scout; a somewhat skilled player of low-stakes poker; a rather good cook; a firm believer in the use of semicolons; and an unabashed political junkie who will never, EVER seek elected office.

  • Elwood

    Who needs Congress any more?

    Prince O’bummer can just rule by imperial fiat!

    The bay area congressional delegation is a bad joke.

  • Truthclubber

    Some observations from direct quotes in this article:

    1) “The only Bay Area House member who didn’t sign the letter was House Minority Leader Nancy Pelosi, D-San Francisco.”

    I guess that her hubby, Paul Pelosi’s portfolio would be hurt if all of those (too) big (to fail) banks whose stock he owns took a hit from massive refinancing OUT of their loan portfolios and into other lenders who were willing to charge less to these poor folks who are underwater through no fault of their own…

    2) “Rep. Jerry McNerney, D-Pleasanton, issued a release noting this region has been disproportionately affected by the financial and housing crises.”

    Jerr — your district is NOT in Pleasanton any more — it’s time you a) grew a pair and moved into that newly carved CD, and b) actually campaigned against the person who is going to mop the floor with you this fall — Ricky Gill.

  • Rick K.

    What? “Live Shot” Garamendi didn’t elbow his way to the front of the line and offer his supposed “expertise” on yet another policy matter? Maybe because he lives in his huge Sacramento River mansion (so big that it encompasses TWO congressional districts, according to his 2009 ‘carpetbagger’ defense), he just can’t relate to those who dwell in humbler abodes.

    “Truthclubber” is on the right track.Why isn’t Leader Pelosi doing the right thing and joining the calls for an “insider trading” rule for members of Congress? As was revealed in the recent CBS-TV “60 Minutes” expose, the Pelosis invested a few million (it’s nice to have spare change like that) in the VISA initial public offering. And then didn’t “Miss Nancy” go easy on the credit card industry, until the “heat” got too much for her?