Pearce Votes Against the Misleading "American Housing Rescue and Foreclosure Prevention Act of 2008"
Today, Congressman Pearce voted against a massive housing bailout that places those who made risky financial loans above taxpayers. The "American Housing Rescue and Foreclosure Prevention Act of 2008", H.R. 3221.
"Although I am very supportive of creating a single regulator for the nation's Government Sponsored Enterprises (GSEs), I cannot stomach exposing taxpayers to $5.3 trillion in losses should the FHA or GSEs fail to collect on their outstanding debt." Pearce said. "I don't believe it is right to reward bad behavior and provide a massive bailout to financial institutions on the taxpayer's dime. Financial institutions that made bad loans should have to make it whole."
"New Mexico's banks and mortgage lenders have made prudent decisions, as the rate of foreclosure in our great state is much lower than California, New York and Florida. The pride of homeownership is the American dream. I will always continue to do all I can in Congress to continue helping families achieve the American dream. I cannot, however, support bailing out lenders on the backs of New Mexico's taxpayers."
H.R. 3221 would expand government bureaucracy by broadening the Federal Housing Administration's role in mortgage insurance; a $300 Billion possible exposure for taxpayers. The bill also grants the U.S. Treasury Department unlimited authority to lend funds to the nation's two largest private mortgagors, Fannie Mae and Freddie Mac; which further exposes taxpayers to $5 trillion in Fannie and Freddie's debt holding. The bill would also create a $4 billion new program allowing states and local governments to use Community Development Block Grant dollars to rehabilitate and resell foreclosed homes.
"Those who have been prudent in their financial decisions will end up paying more for future mortgages and certainly in taxes."
Included in this bill is a $30 million dollar slush fund for trial layers for various lawsuits. "I cannot understand why this government would use taxpayer dollars to help trial lawyers file thousands of lawsuits based on bad financial loans."