House GOP opposes foreclosure legislation

As the number of home foreclosures continues to rise across the country, House Republicans are opposing a bipartisan bill that seeks to remedy the problem.

The House GOP decision is a politically tricky one as campaign strategists predict the issue will likely resonate throughout battleground states such as Ohio and Florida.

 {mosads}“This could be a bigger election issue next year than we currently give it credit for,” said David Wasserman, House editor of The Cook Political Report. “But, it is a difficult issue to condense into a 30-second ad, and it’s difficult to imagine that people specifically affected by the bill will band together into a coherent voting bloc.”

Democratic Congressional Campaign Committee Chairman Chris Van Hollen (Md.) said the foreclosure crisis would be a focal point in affected districts in the 2008 campaign. 

 “This is going to be a big issue; this is a train that everyone saw coming,” Van Hollen said in an interview Wednesday. “Republicans who voted against [mortgage legislation] either don’t care or they don’t get it.”

National Republican Congressional Committee Chairman Tom Cole (Okla.) disagreed, saying the issue is so complicated that it is unlikely to have a major impact next November.

“There are good reasons to be for or against those things,” Cole said. “I find it hard to believe that anyone will lose over this one issue.”

During a Judiciary Committee markup Wednesday of the compromise legislation authored by Chairman John Conyers Jr. (D-Mich.) and Rep. Steve Chabot (R-Ohio), GOP panel members argued that the compromise would cause untold harm to the banking industry and consumers.

“This [legislation] is somewhat less bad [than an earlier version] but it is still a bad bill,” said Rep. Tom Feeney (R-Fla.), whose home state is one of the largest states driving the foreclosure rate nationwide, according to a quarterly report from the Mortgage Bankers Association. “No one said Congress has to have two speeds: zero and overreact.”

Feeney, whose seat is being targeted by Democrats this cycle, cautioned that the bill could limit access to credit and worsen the “real estate recession.”

Rep. Jim Jordan (R-Ohio) echoed Feeney’s remarks.

“We feel this is the wrong direction to go and that’s why I voted no,” he said. 

Chabot, who narrowly survived the 2006 Democratic wave and is expected to face another tough reelection race this cycle, was the only Republican on the panel to vote in favor of the bill. His Ohio district has been hit hard by he foreclosure crisis.

Chabot’s bill applies only to debtors who file for Chapter 13 bankruptcy and lack the income to pay their expenses.

Eric Stein, senior vice president at the Center for Responsible Lending, dismissed Republican arguments that the bill would have a negative impact on any industry involved in the mortgage process. He explained that since the bill deals with only the properties currently in foreclosure, the bill would leave future loans and mortgages untouched.

“It will improve the mortgage [industry] and can help keep the economy stay out of recession,” Stein said.

Chabot said in an interview that he was cautiously optimistic that they would have the votes to pass the bill through the House.

“The goal is to help as many people in their homes as possible,” he said.