Posted on February 24, 2008
Homeownership is part of the American dream. Unfortunately, the housing crunch sweeping the nation is being felt in Tennessee. There has been a 54 percent increase in then number of Tennessee homeowners whose mortgage payments were delinquent, and our state was the 8th highest in the country during the third quarter of 2007 in such mortgage delinquencies. Congress should act immediately to help homeowners in the Volunteer State and throughout the nation. That’s why I’ve joined as a cosponsor of legislation introduced by Senator Johnny Isakson (R-Ga.) to provide a $15,000 tax credit over three years to anyone purchasing a newly constructed home, a foreclosed home, or a home where foreclosure is pending. Providing Americans with this $15,000 tax credit over three years would provide a much-needed boost to the housing market and the economy. This incentive will restore confidence in the housing market while preventing a housing disaster by reducing the number of unsold and foreclosed homes on the market that threaten to lessen home values and reduce homeowner equity. A similar tax credit helped ease the housing slowdown in the 1970s, and it would work again today. The Isakson-Alexander legislation would provide a direct tax credit for the purchase of a single-family home in the amount of $5,000 a year for three years on homes purchased between March 1, 2008, and February 28, 2009. Buyers must occupy the homes as their principal residences to be eligible, and purchases of homes from investors or by investors are ineligible. Homes eligible for the tax credit include: - New homes where the building permit was issued and construction began on or before September 1, 2007; - Owner-occupied homes whose first mortgage loan is in default; and - A single-family home that has been foreclosed on and is owned by the mortgagor or its agent. I ’ve urged my colleagues in the Senate to pass this legislation as soon as possible. In the meantime, immediate help is on the way. Project Lifeline – a partnership coordinated by the federal government among some of the nation’s largest mortgage lenders – will work with individual homeowners on a step-by-step plan to help them modify their loans and remain in their homes. The program would allow some homeowners to pause foreclosure for 30 days while they work with their lenders. With a single phone call to their lender, Americans facing foreclosure may be able to keep their homes. Project Lifeline is a good step toward boosting confidence in the housing market and helping preserve the American dream for the millions of people facing possible foreclosure. Project Lifeline will apply to borrowers who are at least three months late on payments, prime borrowers, and those with poor credit histories and will give step-by-step instructions to help. Homeowners must do the following to be evaluated for a loan modification: - Call their loan servicer within ten days of receiving the notice. - Tell the loan servicer that they have received the letter, they want to stay in the home, and they are willing to seek counseling, if necessary. - Provide updated financial information so the loan servicer can explore the appropriate solution. Tennesseans can learn more about Project Lifeline by calling 1-888-995-HOPE. Thanks to Project Lifeline, a simple phone call may help Americans facing foreclosure keep their homes. I hope Tennesseans will take advantage of this initiative, and I will continue working with my colleagues on other measures that could help stimulate the economy and help Tennessee homeowners avoid foreclosure.