Administration Launches Outreach Campaign in Support of Embattled Housing Program
Obama housing program under fire from lawmakers for not helping enough.
WASHINGTON, June 26, 2009— -- The Obama administration today will launch a national campaign to promote its program to help struggling homeowners keep their homes. But already the program has been criticized by lawmakers, including a handful of key Democrats, for not doing enough.
In a letter to Treasury Secretary Tim Geithner on Wednesday, 20 Democratic senators, including Majority Leader Harry Reid and Senate Banking Committee Chairman Chris Dodd, bluntly stated, "The situation remains grave."
Recent data confirms their warning.
A report released this week by the Federal Housing Finance Agency found that even with expanded foreclosure prevention efforts during the first three months of this year – including various moratoria placed on foreclosures – more people still lost their home than got a modified loan.
"Completed loan modifications increased by 57 percent over the prior quarter to 37,300 and more than doubled compared to the first quarter of 2008," the report said, but added, "Completed foreclosure sales and third-party sales during the quarter increased by 17 percent over the prior quarter to 41,800."
One in every 398 households received a foreclosure filing in May, the third straight month the number of filings exceeded 300,000, according to a RealtyTrac report. The problems remain most severe in the so-called "sand-states" like Nevada and California. And with the country's unemployment rate currently at a 25-year high, it may be some time before the housing sector begins to grow again.
"In order to stabilize the economy we need to stabilize the housing market," Sen. Jack Reed, D-RI, said in a statement. "Companies that have agreed to participate in the administration's foreclosure prevention programs must be held accountable, especially when they are simultaneously receiving taxpayer dollars."
In some cases, it's a problem of access. The National Foreclosure Mitigation Counseling Program said homeowners have to wait an average of 45-60 days for responses to requests for help.
"Homeowners who are looking to get help before it's too late should not have to wait two months to receive an answer to their questions," Reed said. "The administration must keep pushing to ensure that servicers' public pronouncements translate into relief for homeowners."
Related Stories
ABC News Live