Controversial Foreclosure Prevention Bill Passes House
Saturday, May 10, 2008
Despite threats of a presidential veto, the U.S. House of Representatives passed The Neighborhood Stabilization Act (H.R. 5818) on Thursday. The bill, introduced by U.S. Rep. Maxine Waters (D-CA) aims to clear up urban blight by providing $15 billion in federal grant funding to help local and state governments clean up and restore neighborhoods impacted by foreclosures.
“To understand the urgent need to enact this legislation, you just need to visit — as I have —communities like Cleveland, Detroit, or the San Bernardino and Stockton metropolitan areas in California, where block after block is dotted by foreclosed properties, many of them suffering from neglect or actual vandalism. These abandoned and foreclosed properties drag down the value of the homes still occupied by working families, contribute to a cascade effect whereby plummeting home prices erode the tax base of state and local governments and harm real estate related industries such as the construction trades,” Congresswoman Waters said.
The bill has serious critics with opponents saying it benefits lenders and may actually encourage borrowers to give up on saving their homes.
