Mr. Speaker, now more than ever it's critical that we focus our efforts on creating jobs, continuing to stabilize our economy and the housing market, and I am happy to say there's some good news on that front.
Just last month, Mr. Speaker, it was reported that we added 192,000 jobs and that unemployment dipped below 9 percent for the first time in almost 2 years. We're talking about private sector jobs. This was due in part to the recovery efforts that were passed in the 111th Congress and signed by the President.
Now, however, instead of building on the successes of the previous Congress and introducing legislation to continue this economic growth, my colleagues are seeking to pull the plug and return us to policies that got us into this economic mess. Instead of talking about on the floor of the House creating jobs, the Republican leadership is focused on repealing the Patient Bill of Rights; passing H.R. 1, a spending bill that Chairman Bernanke stated will kill 200,000 jobs over the next 2 years; and now removing critical support for homeowners who are struggling to pay their mortgages in this tough economic time.
H.R. 830 is more of the same. At a time when housing markets are beginning to show signs of life, signs of recovery, my Republican colleagues want to eliminate programs that keep families in their homes and protect communities from the crippling consequences of foreclosures.
Democrats want to empower homeowners to get their debts under control, not undermine our economic recovery for political gain. It's critical to preserve the American Dream by keeping families in their homes and out of shelters and unemployment lines, and preserving the integrity of neighborhoods that suffer when homes are foreclosed upon.
Repealing the FHA refinance program would empower collection agencies and municipal eviction squads rather than empower hardworking American families who are suffering in this difficult economic climate or are victims of lenders that created financial products through the housing crisis that led to reckless lending.
The bill we have before us today would be harmful to middle class families who are struggling to stay in their homes. Middle class Americans hurt by this bill are exactly the people we should be protecting in this Congress as we start to build a stronger and more stable economic future for our country. Instead, we saw that this House has raised their taxes with the passage of H.R. 4, and now the Republicans are threatening to remove working families from their homes.
Mr. Speaker, we do all agree that this Nation needs to get its fiscal house in order and resolve the housing crisis. But this bill, an outright repeal of the FHA program, is not the right approach. A strong rebound in the housing market is critical to our economic recovery, creating jobs and ensuring that our banks remain stable.
A good indication of the housing market is the amount of delinquencies or the number of mortgages that are at least 30 days late on their payment. According to Jay Brinkmann, the chief economist for the Mortgage Bankers Association, the latest delinquency numbers represent significant across-the-board decreases in mortgage delinquency rates in the U.S. More importantly, loans that are past due by 90 days or more fell 28 percent.
It's clear that through programs like the FHA short refinance option, which the Republicans are trying to eliminate, we have begun to stabilize the housing market while helping Americans pay their mortgages and stay in their homes. These numbers coincide with signs of a recovery in the job market, and now is not the time to abandon the program.
The FHA refinance program allows people who have mortgages that are worth more than their homes to refinance to a more affordable FHA-insured mortgage. This program allows lenders to write down at least 10 percent of the outstanding principal to help bring monthly payments down to affordable levels. According to CoreLogic, in December of last year, about 22 1/2 percent of all residential properties with mortgages were underwater. We are no stranger to that in Colorado. Many homes in Adams County and Boulder County are underwater. These distressed mortgages pose a threat to our economy and the integrity of the banking system. We can't risk another housing crisis and banking crisis by removing programs that help keep families in their homes and keep the homes out of foreclosure.
My friends on the other side of the aisle will argue that this program has fallen short of its original goals. I agree that this program is not perfect. Instead of scrapping it entirely, we should work to strengthen it, build on success, and figure out how best to resolve the housing crisis this Nation faces. We need to mend it, not end it.
Until just recently, many homeowners weren't even able to partake in this program. Borrowers had difficulty finding banks that had the capacity to refinance under the stringent guidelines of this program. But recently, we've had some good news. Two major banks who underwrite many loans in Colorado, Wells Fargo and Allied Financial, announced pilot projects that would allow underwater borrowers to refinance under this FHA program. By adding these two giants to the mix, the FHA Refinance Program will begin to grow and prosper while it continues to add more banks and increase accessibility. Terminating this project now would result in many families losing their homes and would be a tragic mistake.
Mr. Speaker, banks support this program; homeowners support this program. It's critical that we all allow this program the chance to succeed, rather than make arbitrary budget cuts rather than help struggling families.
This program does not bail out individuals who made mistakes, who made poor decisions, who bought houses they couldn't afford or are looking for a way out of foreclosure. It's not a program to protect vacation homes or mega-mansions. It's not a free line of credit for anybody. This program is a helping hand to the many hardworking Americans who are in a difficult spot, individuals with good credit scores who can help themselves and the banks who hold their mortgages by participating in this program.
In my home State of Colorado, almost 20 percent of all homes were in negative equity. This means about 220,000 families in Colorado are stuck with mortgages that are worth more than their homes. According to The New York Times, ending this program would squander an important chance to prevent foreclosures. In addition, Mark Fleming, the chief economist at CoreLogic, stated, ``Negative equity is a primary factor holding back the housing market and broader economy.'' With so many families underwater, it would be irresponsible of us to eliminate this program and unnecessarily put more Americans at risk of foreclosure.
Mr. Speaker, to date, not a single mortgage that has been refinanced through this program has gone into default. The majority of costs associated with this program occur if these FHA-insured mortgages go into default.
Now, there's no way my friends on the other side of the aisle can call this a waste of taxpayer money because it has yet to spend $1 of the funds it was allocated. In fact, the Dodd-Frank Wall Street Reform and Consumer Protection Act that Congress passed and the President signed last year requires all unused funds from the program to be returned to the Treasury.
By strengthening this program, improving this program, we can continue to keep Americans in their homes at a minimal cost to taxpayers. Mr. Speaker, we must improve this program so we can keep families from defaulting, strengthen the economy, save taxpayer dollars, and stabilize the real estate market.
---
Mr. Speaker, while it has been over 2 months, we have yet to pass a single piece of legislation that promotes job growth in this country. My friends across the aisle repeatedly speak of their mandate to create jobs; and yet instead of listening, the Republicans have focused on bills that will hurt the middle class, disempower the middle class, and, in this case, force more Americans into losing their home.
The Republicans have been talking about repeal and replace. Yet so far all we've seen is repeal, no replace. It's not as if there aren't many viable alternatives when we discuss health care reform. There was discussion, well, what do we do with people that have preexisting conditions? There was an enormous leap of faith with regard to repeal. Oh, we'll get to it someday. Oh, we'll get to it someday.
We're hearing the same thing here. It's not as if these viable alternatives, the replace part, are a mystery. In fact, in the 111th Congress I introduced H.R. 4877, which would have provided a capital gains tax waiver for private investment in community banks, giving local banks sorely needed capital to lend to homeowners who needed to be rescued, to shore up their balance sheets, to encourage primary offerings of equity in the private sector.
My bill would allow Americans to invest directly and profit directly from the economic recovery. I plan shortly to reintroduce this bipartisan bill, and I hope to see an outpouring of support from those who have called for repeal so that there is a replace component to what we actually do need to do as a country to mitigate the housing crisis and stabilize real estate. Republicans and Democrats alike should be interested in free market alternatives that don't just reduce taxes to revitalize the housing market, but can eliminate them.
Mr. Speaker, instead of scrapping this program, we need to have a solid response to the housing crisis in this country. We welcome suggestions from Republicans, independents, all Americans to improve this program to make it accessible to more families. No program is perfect when it's created. And the FHA refinance program has shown that it can successfully keep families in their homes when given the chance. Our recovery is just beginning and it's fragile. We need to provide stability and predictability with regard to the Federal policies in this area.
This is just another example of a broken promise, a repeal without a replace. And it is leaving what is fundamentally a critical public policy issue, on which Democrats and Republicans agree, namely, the stabilization of the housing market, without any answer. And even a partially correct answer, Mr. Speaker, is better than no answer. So I hope that the work proceeds to replace; but in the meantime, repealing without knowing what comes next is an enormous leap of faith that could cost too many middle class families their home, which is why I urge a ``no'' vote on the rule.
Mr. Speaker, if we defeat the previous question I will offer an amendment to the rule to provide that immediately after the House adopts this rule it will bring up H.R. 964, the Federal Price Gouging Prevention Act. This bill, introduced today by my colleague, Mr. Bishop of New York, who we just heard from, would crack down on gas price gouging during international crises affecting oil markets, preventing sellers from taking unfair advantages of circumstances with prices that are unconscionably high.
Mr. Speaker, I urge my colleagues to vote ``no'' and defeat the previous question so we can take up a bill that will help, rather than hurt, struggling families. I urge a ``no'' vote on the rule.
