“ACORN is supportive of this legislation because it provides a viable option for some borrowers to refinance into an affordable loan, as well as provides emergency funds for cities to address the blight in neighborhoods most impacted by rising foreclosures,” Hurd said.

Highlights of the bill include:

• Expansion of the FHA program so borrowers in danger of losing their home can refinance into lower-cost, government-insured mortgages they can afford to repay. In order to participate, lenders and investors must take significant losses by reducing the loan principal. In exchange for an FHA guarantee on the mortgage, borrowers must share any profit from the resale of a refinanced home with the government.

• Establishment of a new regulator to oversee Fannie Mae and Freddie Mac. The bill also gives the Secretary of the Treasury the authority to increase the already existing line of credit to Freddie and Fannie for the next 18 months, as well as gives the Treasury Department authority to buy stock in those companies to provide confidence in the GSEs and stabilize housing finance markets.

• Allocation of $4 billion in Community Development Block Grant (CDBG) funds that will allow cities most affected by the foreclosure crisis to purchase, rehabilitate, and redevelop foreclosed properties and the creation of an affordable housing trust fund that will provide a permanent stream of funding for the construction of affordable rental housing.

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