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Cardoza says U.S. needs to help stop foreclosures
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Rep. Dennis Cardoza, D-Merced, sounded a critical tone over President Barack Obama's State of the Union address last week, noting the president said nothing about the housing mortgage problem which is gripping the nation, and Valley in particular.

He praised Obama for lifting the spirits of weary Americans, and applauded and supports his Innovation Agenda as key to America's future prosperity.

"But soaring oratory and lofty ideas ring hollow when you've lost your job," said Cardoza. "They provide little comfort when you're about to lose your home to foreclosure. And inspiring visions appear dim when you can't remember at time when you weren't struggling, when you looked to the future with hope, instead of worry and even fear."

Cardoza said his constituents feel like Washington has left them behind and stated, "Washington just doesn't get it. The collapse of our nation's economy is directly related to the housing crisis, yet the president did not say one word tonight about this cancer that is still growing and destroying our communities. The president talked of 'winning the future,' but today, the reality in the Valley is that nearly one in five people have lost their jobs and can't find work. Home values have declined by 25 percent - and by over 50 percent in some towns - and foreclosures have transformed entire neighborhoods into ghost towns."

Cardoza is promoting his HOME Act legislation which requires policy changes - not new government spending - to dramatically reduce the number of foreclosures.

The Housing Opportunity and Mortgage Equity (HOME) Act, HR 363, would allow as many as 30 million homeowners with mortgages backed by Fannie Mae or Freddie Mac to benefit from the current historically low market interest rates and refinance for up to 40 years at a fixed rate. Cardoza said that refinancing would significantly lower the homeowner's monthly mortgage payments, resulting in fewer foreclosures, and stabilizing the housing market and our economy.

"The HOME Act would provide a light at the end of the tunnel for the millions of homeowners struggling to make their monthly house payment," said Cardoza. "The Band-aid solutions our government has offered so far have done little to stem the growing tide of foreclosures in this country, and we must take bold action if our economy is ever going to recover."

He said the bill would have little or no cost to taxpayers because the fees for refinancing would be rolled into the new mortgages and penalties would be waived. Since the federal government is ultimately liable for the mortgages issued by Fannie and Freddie, the HOME Act would help reduce that liability by reducing the number of foreclosures.

Since the HOME Act's first introduction in January 2009, Cardoza has made several improvements to reflect input from leading economists and changes in the housing market. Moody's Analytics Chief Economist Mark Zandi and Columbia Business School Senior Vice Dean Christopher Mayer both contributed their expertise and have spoken in support of the HOME Act as a comprehensive approach to stabilizing the housing market.

"The HOME Act will jump-start more mortgage refinancings, quickly helping stressed homeowners make their mortgage payments and avoid foreclosure, at little or no cost to taxpayers," said Zandi.

The HOME Act would also reinvigorate the economy by giving millions of Americans a reduced mortgage payment, resulting in more money to spend on purchases. Morgan Stanley and JP Morgan Chase have evaluated potential savings from a refinancing program like the HOME Act and have estimated it would reduce mortgage payments by $50 billion or more annually.

Congressman Cardoza's congressional district (Merced, Modesto, Stockton) has been ground-zero for the housing crisis, struggling with some of the highest foreclosure rates in the country.