US treasury calls on Congress to move housing-related legislation

US treasury calls on Congress to move housing-related legislation

	Published : Tue, 30 Oct 2007 16:53 By : Agencies Print this Story

WASHINGTON (Thomson Financial) - A senior Treasury official today called on Congress to quickly approve legislation aimed at rescuing borrowers who are having trouble making their mortgage payments, including bills that would reduce the tax burden of these borrowers, expanding government mortgage insurance, and expanding mortgage counseling services.

David Nason, assistant secretary of Treasury for financial institutions, said in remarks today before the Women in Housing and Finance that both Congress and the Bush administration agree on these goals, and that Congress should quickly approve legislation enacting them.

'Congress should send legislation to the President on these bipartisan efforts as soon as possible,' he said.

Congress's Joint Economic Committee last week reiterated the importance of passing legislation to modernize the Federal Housing Authority (FHA) so that entity can insure larger mortgage loans. It also said Congress needs to approve legislation that would stop canceled mortgage debt from being treated as taxable income, and appropriating more funds for mortgage counseling.

The House has approved FHA legislation, but the Senate has not, although a key Senate committee has approved legislation. The House has also approved a mortgage-debt relief bill, which is awaiting action in the Senate. Both the House and Senate have approved funds for mortgage counseling, although the JEC said last week that more money is needed.

Nason said the administration supports these specific goals, and said there is no time to waste in getting them approved.

'Homeowners not reached before their resets occur are at a much higher risk of defaulting,' he said. 'Our plan supports an increased role for housing counselors, but their efforts will be less meaningful if the appropriate tools are not available.'

Aside from these legislative initiatives, Nason said the administration has already begun working for loan originators to ensure they are able to modify loans in order to help borrowers who might be struggling with rising interest rates on their mortgages.

He also reiterated that the Treasury Department is heading up an effort to ensure US capital markets are competitive. This includes efforts to audit the auditing profession, and examine US financial regulations to ensure they are efficient.

pete.kasperowicz@thomson.com

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