WASHINGTON, D.C. – July 25, 2013 – (RealEstateRama) — Today, House Financial Services Committee Republicans rushed through passing a radical a housing finance plan (PATH ACT) that could force homeowners into risky and exotic mortgages, gut protections for homebuyers, and end the 30-year fixed rate mortgage. U.S. Rep. Ed Perlmutter (CO-07), a member of the House Financial Services Committee called this measure a “Path to Nowhere” and voted against the measure in committee. The Republican plan would significantly raise the price of homeownership while at the same time eliminate many affordable housing programs.
“Americans can’t afford to travel down this ideological Republican path to nowhere,” said Perlmutter. “In Colorado and throughout the nation, home sales are up and foreclosures continue to fall. Let’s show Americans we can come together in a bipartisan way to implement responsible reforms to continue moving us forward and ensuring the hardworking folks in Colorado can achieve the dream of homeownership.”
The PATH act, introduced this week by House Republicans on the Financial Services Committee, is a hastily concocted, radical scheme that opens the door for the return of subprime mortgages and other exotic mortgage products. While mortgage rates are still at historic lows, according to The Denver Post, they are beginning to climb rapidly. This extreme bill would ensure otherwise qualified buyers are priced out of the market, and it guts recently enacted mortgage protections, ends the 30-year fixed rate mortgage, limits FHA loans only to first-time homebuyers, caps eligibility for the program and severely reduces its insurance coverage.
“The traditional, 30-year, fixed rate mortgage was not the cause of our financial crisis,” said Perlmutter. “There are reasonable, workable solutions to avoid risky loans, ensure stable, affordable mortgages are available at reasonable interest rates and terms, and strengthen homeownership opportunities.”