Foreclosure crisis deserves attention (Sen. Jeff Merkley)

A comprehensive solution to the foreclosure crisis is not just a piece of the economic recovery, it is the keystone.  When a family loses their home, it inflicts economic damage on an entire community.  If foreclosure continues to threaten the economic stability of millions of Americans, even the most innovative efforts at economic recovery are likely to fall short.  

That’s why, in a letter to President Obama last week, I urged him to use the State of the Union as an opportunity to renew efforts to restore the housing market and provide more options families facing foreclosure.  

The numbers tell a clear story why this renewed focus is needed. Over 300,000 foreclosures have been filed against American families each month for the past 20 months.  

The Obama Administration recognized the risk of a continued foreclosure crisis early on and launched the Home Affordable Modification Program (HAMP) with the goal of preventing three to four million foreclosures. Unfortunately, this effort has fallen short, with fewer than 600,000 homeowners receiving approval for permanent loan modifications.  Experts now estimate that only one-quarter of the $50 billion pledged for the HAMP program will be expended.

To provide a starting point, I have developed a set of policy initiatives that have the potential to give more options to homeowners facing foreclosure and help turn around the housing market. The proposal includes the following initiatives:

    * Stop the “dual track” that continues foreclosures while loan modifications are evaluated
    * Provide homeowners with a single point of access when they seek a loan modification
    * Assist families facing foreclosure through a national short refinance program
    * Establish a third-party review prior to foreclosure and fully enforce existing law
    * Implement the lifeline bankruptcy option
    * Bolster the market with a permanent tax credit for first-time homebuyers

I sincerely hope that President Obama will take a moment during his speech to the nation tonight to bring our focus back to the crisis that is wreaking havoc on our families, our communities, and our prospects for economic recovery.    We must bring at least as much energy and determination to assist families across America as we brought to assist financial institutions.