May 8, 2009

WASHINGTON, DC – Congressman David Dreier (R-San Dimas, CA) voted yesterday to establish important mortgage lending standards that will help prevent predatory lending. Dreier supported H.R. 1728, the Mortgage Reform and Anti-Predatory Lending Act, which was approved by a vote of 300 - 114.

“Unscrupulous lending practices greatly contributed to the current economic downturn,” Dreier said. “Ensuring that lenders make responsible loans to borrowers will go a long way toward cracking down on mortgage fraud and abuse. While we must continue to work to improve the bill, it is a critical step towards restoring confidence in our housing and financial markets, and ultimately getting our economy back on track.”

H.R. 1728 would require mortgage lenders to make a reasonable and good faith determination, based on verifiable information, that the borrower has a reasonable ability to repay the loan. The bill also mandates that lenders become licensed and registered under state or federal law. In addition, the measure enhances taxpayer protections by requiring greater transparency and accountability on the federal funding used to provide homeowner counseling assistance.

Dreier said that in addition to reforming lending practices, real incentives for responsible home-buyers are critical to getting the housing market moving again. “At the same time, we must provide incentives to reduce the number of unsold homes currently on the market,” Dreier added. “My legislation, H.R. 101, the Economic Recovery Through Responsible Homeownership Act, provides a tax credit to borrowers who make a significant down payment. This helps responsible individuals and families and provides a boost to the housing market.”