IV 

110TH CONGRESS 

1ST SESSION H. RES. 526 

Supporting home ownership and responsible lending. 

IN THE HOUSE OF REPRESENTATIVES 

JUNE 28, 2007 

Mr. CUMMINGS submitted the following resolution; which was referred to the 

Committee on Financial Services 

RESOLUTION 

Supporting home ownership and responsible lending. 

Whereas home ownership is an important part of realizing 

the American Dream; 

Whereas home ownership is a powerful economic stimulus, 

both for individual homeowners and for the national 

economy; 

Whereas home ownership also benefits neighborhoods by raising property values and by providing economic and social 

capital in previously distressed communities; 

Whereas in 2006, more than 75,000,000 Americans owned 

homes, and the home ownership rate was nearly 69 percent, a near record high; 

Whereas the home ownership rate for non-Hispanic whites in 

2006 was 76 percent, while the rate for African American households was only 48.2 percent; Hispanic houseVerDate Aug 31 2005 05:09 Jun 29, 2007 Jkt 059200 PO 00000 Frm 00001 Fmt 6652 Sfmt 6300 E:\BILLS\HR526.IH HR526

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•HRES 526 IH 

holds were at 49.5 percent, and Asian, Native Americans, 

and Pacific Islanders were at 60 percent; 

Whereas this Nation experienced a housing boom from 2001 

to 2006, due to historically low mortgage rates, rising 

home prices, and increased liquidity in the secondary 

mortgage market, all factors that led to the growth of the 

sub-prime mortgage industry; 

Whereas the sub-prime market has created home ownership 

opportunities for lower-income people, families without 

access to down payments and people with little or no 

credit histories, but has also created opportunities for 

‘‘predatory’’ lending in which unscrupulous lenders have 

hidden the true cost of sub-prime loans from unsophisticated borrowers; 

Whereas during the past few months, it has become increasingly clear that irresponsible sub-prime lending practices 

have contributed to a wave of foreclosures that are harming communities and disrupting housing markets; 

Whereas higher cost sub-prime mortgage loans are most prevalent in lower-income neighborhoods with high concentrations of minorities (in 2005, 53 percent of African American and 37.8 percent of Hispanic borrowers took out 

sub-prime loans); 

Whereas foreclosures are also costly from a legal and administrative standpoint, with the average foreclosure costing 

the borrower $7,200 in administrative charges; 

Whereas lenders do not typically benefit from taking over a 

delinquent owner’s property, losing thousands of dollars 

per foreclosure; 


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•HRES 526 IH 

Whereas foreclosures can also be very costly for local governments because abandoned homes cost districts tax revenue; 

Whereas a recent study calculated that a single-family home 

foreclosure lowers the value of homes located within oneeighth of a mile (or one city block) by an average of 0.9 

percent and even more so (1.4 percent) in low to moderate-income communities; and 

Whereas the time has come to raise awareness about the dangers of risky loans and to protect homeowners from unscrupulous lending practices: Now, therefore, be it 

1 Resolved, That— 

2 (1) it is the sense of the House that Govern3 ment action should be taken that protects buyers 

4 from unscrupulous mortgage brokers and lenders; 

5 and 

6 (2) specifically, such action should— 

7 (A) enforce rules to eliminate unfair and 

8 deceptive practices in sub-prime mortgage lend9 ing; 

10 (B) encourage lenders to evaluate a bor11 rower’s ability to reasonably repay any mort12 gage loan; 

13 (C) establish clear minimum standards for 

14 mortgage originators; 

15 (D) require that disclosures clearly and ef16 fectively communicate necessary information 


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•HRES 526 IH 

1 about any mortgage loan to the potential bor2 rower; 

3 (E) reduce or eliminate abuses in prepay4 ment penalties; 

5 (F) address appraisal and other mortgage 

6 fraud; 

7 (G) raise public awareness regarding mort8 gage originators whose loans have high fore9 closure rates; and 

10 (H) increase opportunities for loan coun11 seling. 

Æ 


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