In an effort to ameliorate the impact of the potential termination of federal foreclosure programs by bills recently passed in the House of Representatives, Steve Cohen (D-TN), has proposed a bill establishing a grant program for state and local governments to mediate between homeowners and lenders and hopefully prevent foreclosures[1]. Cohen has stated that “foreclosures evaporate middle class wealth” and believes that his “Preventing Homeowners from Foreclosure Act of 2011” (HR1131) would help keep families in homes by postponing sheriff sales of owner-occupied residences until the homeowner and lender have met face to face and addressed foreclosure alternatives. The bill also includes an outreach program to help homeowners become more aware of their options. Currently, the bill is under review by the House Financial Services Committee[2]. While the bill seems well intentioned, it also seems rather pointless since the president has clearly stated that he will not allow federal foreclosure aid programs like HAMP to be terminated.
Do you think that the government should explore other alternatives to the failed housing relief programs currently in place as Cohen seems to be suggesting, or should government stay out of the situation all together?
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[1] http://www.dsnews.com/articles/congressman-introduces-bill-to-prevent-foreclosures-in-memphis-2011-03-22
[2] http://reversemortgagedaily.com/2011/03/22/house-bill-supports-foreclosure-mediation/
