RealEstateRama   -   Site   -   in News   -   in Media   -   in Social   -   Web

Schock Amendment to Prevent Future Foreclosures Passes House

Amendment to FY 10 Transportation, Housing and Urban Development Appropriations Act Ensures Consumers Enter into Responsible Mortgages

July 24, 2009 – (RealEstateRama) — The House unanimously approved an amendment offered by Congressman Aaron Schock (R-IL) today to H.R. 3288, the Fiscal Year 2010 (FY 10) Transportation, Housing and Urban Development Appropriations Act. 

The Schock Amendment increases funding by $5 million for the Department of Housing and Urban Development’s (HUD) Housing Counseling Assistance Program, which helps those considering homeownership understand the terms, rates, fluctuations and monetary investments required on their behalf before making the lifetime commitment of a mortgage.  This counseling will help prevent future foreclosures. 

“Our country continues to see a significant increase in foreclosures; which were up 18 percent this January over last.  Those figures continued to rise the first quarter of 2009 with an additional 616,000 homeowners filing foreclosure, over 25,000 in my home state of Illinois alone, and now the percentage of subprime loans in foreclosure has for the first time ever eclipsed 14 percent.   We have all heard about these ridiculous loans, ballooning adjustable rates, reverse amortization, and interest-only “mortgages” which never actually provide homeownership.  These vehicles of financial ruin usually have only one possible result for the homeowner, foreclosure,” said Schock.  “It is time we take some preventive action to make certain homeowners have access to professionals which will assist them in understanding what they are getting into and hopefully avoid not only delinquency, but ultimately foreclosure.”

“I believe in the benefit of “an ounce of prevention” and am seeking to increase funding for one of the only federal government programs which focuses on helping ensure that consumers do not enter into home mortgages for which they cannot afford, thus avoiding foreclosures,” Schock continued.  “Providing assistance to homeowners and those considering homeownership is a proactive step the Government can take that not only helps the individual but also helps communities through preservation of property tax revenues and prevents increases in crime.“

The Housing Counseling Assistance Program is accessible to anyone considering buying a house – whether through a federal, state or local program, or the regular private market – to get the counseling they need to make their rent or mortgage payments and to be a responsible homeowner in other ways. 

The benefits of pre-purchase counseling are integral resources for potential homebuyers. When an approved HUD counselor sits down with a prospective homebuyer the important discussion of identifying goals, future resources, and realistic expectations takes place so that the homebuyer is fully aware of the significant life investment they are about to undertake.  The HUD counselor helps design a counseling plan for the client which includes responsible homeownership actions the client should take, as well as refers the client to other resources within the community that would be of assistance.

“In my own district I have 17 HUD approved housing counseling agencies, a number of which have spoken to me recently about the significant increase in usage over this time a year ago,” Schock concluded “To accommodate this influx in demand we must ensure that these counseling outlets have the resources necessary to stay open and continue to help Americans get the important information and guidance they need before purchasing a home.  The adoption of this amendment will go a long way to ensuring that millions of Americans get started off on the right foot when pursuing the American dream of homeownership.”


U.S. Department of Housing and Urban Development (HUD) is the nation’s housing agency committed to increasing homeownership, particularly among minorities; creating affordable housing opportunities for low-income Americans; and supporting the homeless, elderly, people with disabilities and people living with AIDS. The Department also promotes economic and community development, and enforces the nation’s fair housing laws.


Brian Sullivan
(202) 708-0685