Rep. Barney Frank (D-Massachusetts) wants to ensure the growing population of jobless Americans don’t fall victim to foreclosure. At a House Financial Services Committee hearing on Thursday – a committee which Frank chairs – he pushed for another $6.5 billion stimulus program he’s calling “TARP for Main Street.”
The proposal includes a $2 billion loan program for unemployed homeowners who do not qualify for other mortgage aid since they no longer have a steady income stream to claim. The initiative would essentially bring back a 1975 program that provides credit to Americans who’ve lost their jobs so they don’t also lose their home – however borrowers would have to secure the loan with their property.
One billion dollars would also be earmarked to build and maintain affordable housing, $1.5 billion to revitalize foreclosed and vacant homes, and $2 billion to help apartment tenants keep their residence if the management company defaults on the mortgage.
The program would reportedly be funded with the dividends banks are paying the Treasury for the taxpayer dollars they received as part of Congress’ $700 billion bailout.
Frank is also fast-tracking the White House’s proposed bill that would create a new federal regulatory office, the Consumer Financial Protection Agency. The agency would be the primary protector of consumers’ rights related to the purchase of financial products such as mortgages, credit cards, and other loans.
In a statement, Frank said, “Recent reports about the lack of mortgage modifications and increases in various fees only reinforce the need for this bill. I am confident that we will produce a bill that will provide greater consumer protections while in no way burdening the legitimate activities of responsible banking.”
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