by Broderick Perkins
© 2008 DeadlineNews.Com
Unauthorized use of this story is a copyright violation -- a federal crime
Deadline Newsroom - A new one-two legislative combination punch may not put the housing crisis down for the count, but it should keep more homeowners on their feet and put real estate fraud on the ropes.
President Barack Obama recently signed the Helping Families Save Their Homes Act and the Fraud Enforcement and Recovery Act into law in his latest effort to stem the tide of foreclosures.
"These landmark pieces of legislation will protect hardworking Americans, crack down on those who seek to take advantage of them, and ensure that the problems that led us into this crisis never happen again," said President Obama in a prepared statement.
Here's a look at the benefits of both new laws.
Helping Families Save Their Homes Act
Hope for Homeowners - Bringing the struggling Hope for Homeowners in under Obama's Making Home Affordable umbrella, to new legislation means virtual one stop shopping for housing assistance that includes loan modifications, refinancing, short sales and other assistance to avoid foreclosure.
• Modifications to Federal Housing Administration (FHA) and federally guaranteed farm loans - This provision targets FHA, federally guaranteed farm loans and rural loans with loan modification help.
• Increasing the flow of credit -- Provisions to expand the Federal Deposit Insurance Corporation (FDIC) and the National Credit Union Association (NCUA) include extending the temporary increase in deposit insurance; increasing the borrowing authority of the FDIC and increasing the borrowing authority and creation of a stabilization fund for the NCUA. The efforts are designed to enhance the availability of credit to consumers.
• Increased housing consumer protections - Provisions provide for new protections for renters, including Section 8 tenants, living in foreclosed homes; establish the right of homeowners to know who owns their mortgage so they know who to contact when trouble comes; provide resources for the homeless including more direct aid to the homeless; provide for the consolidation of homelessness programs to streamline their administration and targets assistance to families with children.
The Fraud Enforcement and Recovery Act
Furthering a federal mortgage fraud crackdown after a projected 300 percent increase in mortgage fraud this act is designed to keep crooks away from struggling and vulnerable homeowners.
• Adding private mortgage brokers and others to enforcement efforts - More than 50 percent of subprime mortgages were originated by private mortgage institutions and similar entities not currently covered under federal bank fraud criminal statutes. FERA extends mortgage fraud enforcement to these companies and all private mortgage brokers and companies not previously regulated or insured by the feds.
• Extending prohibition of mortgage lending manipulation to private operations - Previously, making a materially false statement or willfully over valuing a property to influence a mortgage lending decision was a crime applying only to federally-regulated institutions. Under the new law enforcement is extended to private mortgage brokers and other private lenders.
• Further funding enforcement efforts - For fraud prevention and enforcement the new law authorizes $165 million in new resources for 2010 and 2011 to hire fraud prosecutors and investigators.
Also to strengthen the federal regulatory and enforcement capacity the legislation authorizes $140 million for the Federal Bureau of Investigations (FBI); $50 million for U.S. Attorney's Offices ($20 million for the Criminal Division, $15 million for the Civil Division, $5 million for the Tax Division); $30 million for the US Postal Inspection Service; $30 million for the Inspector General at the Department of Housing and Urban Development; $20 million for the Secret Service; and $21 million for the Securities and Exchange Commission.
• The new law also creates a bipartisan Financial Crisis Inquiry Commission to investigate the financial practices that contributed to the current financial crisis, in order to prevent future economic calamity.
Read more news about housing assistance from the Obama Administration.
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© 2008 DeadlineNews.Com
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Broderick Perkins, an award-winning consumer journalist, parlayed 30 years of old-school journalism into a digital real estate news service, the San Jose, CA-based DeadlineNews Group, including DeadlineNews.Com, a real estate news and consulting service and Web site, and the Deadline Newsroom, DeadlineNews.Com's news back shop. Perkins is also a National Real Estate Examiner. All the news that really hits home from three locations -- that's location, location, location!
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