Congressman Jim Moran, Northern Virginia Democrat and member of the Congressional Progressive Caucus (CPC), joined advocates in New York, Washington, D.C. and Southern California in calling on Edward DeMarco, the Acting Director of the Federal Housing Finance Agency, which oversees Fannie Mae and Freddie Mac, to write down principal amounts for struggling homeowners.
“Twelve million Americans owe more money than their home is worth,” Rep. Moran said. “Fannie and Freddie need to move forward with principal reductions to aid underwater homeowners, improving their balance sheets by preventing foreclosures and helping the overall economy.”
Combined, Freddie Mac and Fannie Mae own or guarantee more than half of all mortgages in the country, including nearly three million that are underwater. These Government-Sponsored Enterprises (GSEs) are uniquely positioned to address the continuing mortgage crisis, especially given that the Treasury Department recently tripled the incentives available to investors, including GSEs, that offer principal reductions to homeowners.
“Write downs are about keeping families in their homes and saving taxpayers money by preventing foreclosures,” continued Moran. “Their neighbors are better protected because foreclosures often lower other home values in the neighborhood. Simple, straightforward principal reductions are a good way to prevent the foreclosure crisis anchor from dragging down the U.S. recovery.”
On Monday, Congressman Moran joined 116 of his colleagues in calling for Acting Director DeMarco to reverse his stated opposition to principal writedown for homeowners. This call echoes that of a coalition of progressive organizations working to help families struggling to keep their homes. Protests were held yesterday at regional Freddie Mac offices demanding fair negotiations for themselves and other Americans who have been evicted from their homes.