Momentum in Congress for the Homeowners and Bank Protection Act of 2007 has begun

....Two New Hampshire State Representatives, Barbara Hull Richardson (Cheshire), and Barbara French (Merrimack), yesterday introduced a "Resolution to Congress--Implement the Homeowners and Bank Protection Act of 2007", which is the first of what will soon be a flood of resolutions in state legislatures, city councils, and other elected bodies, kicking Congress in the rear-end to do the only appropriate thing--pass the HBPA without delay.

The following is the text of their Resolution:

Resolution to Congress---Implement the Homeowners and Bank Protection Act of 2007

Whereas, the onrushing financial crisis engulfing home mortgages, debt instruments of all types, and the banking system of the United States threatens to set off an economic depression worse than the 1930’s; and

Whereas, millions of American citizens are threatened with foreclosure and loss of their homes over the upcoming months, according to studies released by Realty Trac and Moody’s Economy.com; and

Whereas, this financial crisis is now threatening the integrity of both state and federally chartered banks, as typified by the run on deposits of Countrywide Financial in California during the month of August; and such a banking collapse would wipe out the life savings of American citizens, and drastically undermine the economic stability of our states and cities; and

Whereas, in a similar financial crisis in the 1930’s, President Franklin D. Roosevelt intervened to protect banks and homeonwners; for example in April, 1933 he introduced legislation as a “declaration of national policy…that the broad interests of the Nation require that special safeguards should be thrown around home ownership as a guarantee of social and economic stability…”, and therefore,

Be it Resolved, that the State of New Hampshire hereby endorses the Homeowners and Bank Protection Act of 2007. This crisis is such that it requires emergency action that only the United States Congress has the capability to enact. Congress must move quickly to keep people in their homes and avert social chaos. This act includes the following provisions:

1. Congress must establish a Federal agency to place the Federal and state chartered banks under protection, freezing all existing home mortgages for a period of how ever many months or years are required to adjust the values to fair prices, and restructure existing mortgages at appropriate interest rates. Further, this action would also write off all of the speculative debt obligations of mortgage-backed securities, derivatives and other forms of Ponzi Schemes that have brought the banking system to the point of bankruptcy.

2. During the transitional period, all individual homeowner foreclosures shall be frozen, allowing American families to retain their homes. Monthly payments, the equivalent of rental payments, shall be made to designated banks, which can use the funds as collateral for normal lending practices, thus recapitalizing the banking systems. These affordable monthly payments will be factored into new mortgages, reflecting the deflating of the housing bubble, and the establishment of appropriate property valuations, and reduced fixed mortgage interest rates. This shakeout will take several years to achieve. In the interim period no homeowner shall be evicted from his or her property, and the Federal and state chartered banks shall be protected, so they can resume their traditional functions, serving local communities, and facilitating credit for investment in productive industries, agriculture, infrastructure, etc.

3. State governors shall assume the administrative responsibilities for implementing the program, including the “rental” assessments to designated banks, with the Federal government providing the necessary credits and guarantees to assure the successful transition.

And therefore,

Be it Further Resolved, that a copy of this resolution shall be forwarded to members of Congress from the state of New Hampshire and also be delivered to the President of the United States for immediate implementation.

Filed---As House Concurrent Resolution, September, 18, 2007

Sponsors---Rep. Barbara Hull Richardson

Rep. Barbara French

Earlier former Congressman Andrew Jacobs Jr. (D.-IN) commented on Sept. 14.

"I think the Homeowner and Bank Protection Act of 2007 is the right approach to an out of control, systemic problem and I endorse Missouri State Representative Juanita Walton's resolution for the National Black Caucus of State Legislators which calls on Congress to Implement the Act.


Juanita Walton added her comments:

MISSOURI HOUSE OF REPRESENTATIVES
JUANITA HEAD WALTON
State Representative
District 81

Resolution to Congress---Implement the Homeowners and Bank Protection Act of 2007


Whereas, the onrushing financial crisis engulfing home mortgages, debt instruments of all types, and the banking system of the United States threatens to set off an economic depression worse than the 1930’s; and

Whereas, millions of American citizens are threatened with foreclosure and loss of their homes over the upcoming months, according to studies released by Realty Trac and Moody’s Economy.com; and

<continued with the above outline of the Bill and concluded>

...And therefore,

NOW, THEREFORE BE IT RESOLVED BY THE 31ST ANNUAL LESIGLATIVE CONFERENCE OF THE NATIONAL BLACK CAUCUS OF STATE LEGISLATORS, ASSEMBLED IN LITTLE ROCK, ARKANSAS, DECEMBER 12 – DECEMBER 16, 2007, that the NBCSL urges the Congress of the United States to make all foreclosures frozen, allowing American families to retain their homes.


Fred Huenefeld, a leading Democrat and realtor in Louisiana

... has endorsed the Homeowners and Bank Protection Act of 2007 (HBPA), and has also organized three other endorsers including: State Senator Robert Kostelko (R-Monroe); Mayor Jack Hammons of Winnsboro, La., and Mayor Reggie Skains of Downsville, La. Huenefeld was scheduled to present a resolution calling for support of HBPA to the exececutive board of the Louisiana Realtors Association on Sept. 19.

There should be a clause in there giving the SEC the mandate to regulate the unregulated hedge funds market. It is precisely the activity within this unregulated sector that has contributed to this sub-prime disaster. Many hedge funds got involved in the sub-prime market in a big way.

like Moody's

1. The only reason there was a run on Countrywide is because people equated the bank with the mortgage side. I think they are 2 entirely different entitites.

2. I don't think it's the federal and state chartered banks that need "protecting" - they sold off their mortgages to 3rd party investors. Although from what I understand, they do have to buy back loans that default within 12 months. I don't think federally and state chartered banks are supposed to do the type of risky lending that sub-prime involved. Risky mortgages got passed of to specific sub-prime lenders.The people taking the bath are the 3rd party investors and mortgage companies who funded sub-prime mortgages. (Please feel free to correct me about anything in this post.)

2. Freezing "all"(!)existing home mortages. I mean really, ALL mortgages? I think they might mean all sub-prime mortgages, or any mortgages that portray the inherent signs of predatory lending (I could make up a laundry list real quick of the symptoms)or some of the more bizarre mortgage products that were offered in the last few years, but I think the word "all" is a bit much.

3. Are they also going to protect the flippers and the speculators who had a large part in driving up the prices of houses into the stratosphere, or is this confined to actual homeowners living in their home? I hope the latter. The speculators don't offer to share the upside with the rest of us, so I have no desire to relieve them of the downside. That is the inherent risk of speculating in real estate for a profit.

4. Write off ALL (there's that word again)of the speculative debt obligations of mortgage backed securities, blah blah . . . Who's doing the writing off? What the heck does this sentence actually say? If one writes off the value of all CDO's, I think billions and billions of dollars will evaporate. Not that they might not anyway, but not ALL of the debt that was bundled and securitized is bad. They need to weed the wheat from the chaff.

I would like to end by saying I think it is great that someone is trying to actually do something to keep people in their homes. Many people were actually victimized by predatory lending - I could link to gobs and gobs of articles. I also know that some people were just dumb or overly optimistic, or whatever you want to call it, but it truly will do no good to anyone to have a giant rolling wave of foreclosures across the country. I also hope that people who are losing their homes due to medical bills because of our God awful health care system might find some relief here.