Quigley and Bipartisan Coalition Introduce Bill to Encourage Savings
WASHINGTON – November 7, 2011 – (RealEstateRama) — U.S. Representatives Mike Quigley (D-IL), John Carney (D-DE), Jim Renacci (R-OH), Pat Meehan (R-PA), and Daniel Webster (R-FL) introduced the “Creating Homeownership Opportunities Act,” bipartisan legislation that would create a pre-tax savings program – similar to a Health Savings Account – for the purpose of saving toward a down payment on a first home.
“This bipartisan legislation will move hardworking families closer to the American dream more quickly by encouraging smart, tax-free savings now and reduced debt in the future,” said Congressman Quigley. “Solving our country’s housing crisis is as much about creating new opportunities for first-time homeowners as it is keeping current homeowners out of foreclosure. This legislation will play an important role in getting the America’s housing markets back on track.”
Only first time home buyers would be eligible for the program and annual contributions would be limited to $10,000, indexed for inflation. Qualifying purchases would only include a down payment on a primary residence, as well as closing costs and fees associated with the purchase of that home. Non-qualified disbursements would be subject to income tax, as well as a 20 percent penalty – a structure mirroring that of a Health Savings Account. An account balance may be rolled over into an IRA to supplement retirement savings if an account holder reaches 55 without purchasing a home, maintains the account for 20 years without purchasing a home, or purchases a home and has a remaining balance in the account.
“Purchasing a home is the foundation of the American Dream, but many families are having trouble saving enough money for a down payment,” said Congressman Carney. “This legislation allows families to set aside a tax-free portion of their earnings to use towards their first home purchase. As the economy continues to struggle, we need to jumpstart the housing market and encourage American families to save money and take on less debt.”
“The unfortunate reality of the last several years is that millions of Americans have lost their homes or found themselves under water on their mortgages,” said Congressman Renacci. “Some borrowed more than they could actually afford, and others were simply the victim of a severe recession and tepid economic recovery. Our bi-partisan legislation will help ensure new homeowners get off on the right foot by saving more toward their down payment faster and creating more equity while incurring less debt. Buying a home is an important part of the American Dream and securing one’s financial future. We want to make sure it stays that way.”
“With so many struggling in this difficult economy, families need new tools to buy their first home,” said Congressman Meehan. “This bipartisan, common-sense legislation will help encourage savings and make the process of buying a home more achievable.”
“The Creating Homeownership Opportunities Act is a common-sense, bipartisan measure that encourages a non-partisan ideal: responsible savings for homeownership,” said Congressman Webster. “During these difficult economic times, saving enough money to put a down payment on a house is hard enough. With this legislation, families will be able to save for what is often times the biggest purchase they will ever make, a home, without the additional burden of having those savings increasingly taxed by the federal government.”
More on the co-sponsors
Rep. Quigley is serving his second term in the U.S. House of Representatives, where he sits on the Committee on the Judiciary and the Committee on Oversight and Government Reform. He is also the Ranking Member for the Subcommittee on TARP, Financial Services, and Bailouts of Public and Private Programs.
Rep. Carney represents the state of Delaware in the U.S. House of Representatives, where he serves on the Financial Services Committee. He was previously elected to two terms as Lieutenant Governor of Delaware from 2001-2009 and served as Delaware’s Secretary of Finance during the Carper Administration from 1997-2000.
Rep. Renacci is serving his first term in the U.S. House of Representatives, where he is a member of the Financial Services Committee. Prior to his election he worked as a Certified Public Accountant in the health care industry, and owned and operated over 60 other businesses in the automotive and sports management fields.
Rep. Meehan represents the 7th district of Pennsylvania in the U.S. House of Representatives. He serves on the Oversight and Government Reform and Transportation and Infrastructure Committees. He is also Chairman of the House Homeland Security Subcommittee on Counterterrorism and Intelligence. Rep. Meehan is a former U.S. Attorney for the Eastern District of Pennsylvania.
Rep. Webster represents Central Florida in the U.S. House of Representatives, where he serves on the Rules Committee. Prior to his election, he served 28 years in the Florida Legislature.
