A large partnership of housing and civil rights organizations to reach Monday to congressional leaders pleading for additional relief for homeowners in the upcoming COVID-19 stimulus package.
The letter was signed by representatives of more than 350 housing and civil rights organizations, including American Bankers Association, Mortgage Bankers Association, National Association of Realtors, National Association of Home Builders and Housing Policy Council, the NAACP, National Urban League, National Alliance for Fair Housing and National Center for Consumer Law.
Letter calls for $ 25 billion in direct assistance to homeowners struggling due to the COVID-19 pandemic, at least $ 100 million for housing counseling and just under $ 40 million for the program fair housing initiatives.
Of the estimated 3.8 million homeowners past due on their mortgages, more than half of them are people of color, according to Census office.
Recent homebuyers who relied on low or no downpayment loans FHA, Virginia or the Rural Housing Service are particularly at risk, the group argues, noting that even six months of forbearance can put borrowers under water on their mortgages, due to more than the value of their home.
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“In addition, these borrowers are mainly black and Latin families, first-time buyers and low to moderate income families,” the letter said. “Help with mortgage payments will be of critical importance to the nearly 3 million borrowers who remain on the long-term forbearance plans of their mortgage agents. We can’t begin to tackle racial property and wealth disparities if we don’t take action to prevent a wave of COVID-induced foreclosures and loss of home equity. “
The group hopes that most of the requested $ 25 billion will come from the recently reintroduced Homeowners Assistance Fund, which can be used by state housing finance agencies. In the letter to Congress, the group says the HAF can help homeowners by providing direct assistance with mortgage payments and affordable loan modifications, while also helping with utility payments, property tax payments and mortgage payments. insurance, homeowner’s association dues, and other home equity loss support.
The outreach of housing and civil rights groups comes at a pivotal time for the US housing industry. Newly appointed Treasury Secretary Janet Yellen has noted She will play a key role in advancing the Biden administration’s economic agenda on Capitol Hill – which includes aggressive aid distribution to avoid an even longer recession.
President Joe Biden has repeatedly said his administration is focused on helping people in need of affordable housing, and his $ 1.9 trillion American rescue plan was recently voted in the budget reconciliation process in order to speed up its adoption. The plan includes $ 30 billion in additional funding for emergency rental, energy and water assistance for hard-hit households, as well as $ 5 billion in emergency assistance to the homeless or to risk.
All this at a time in the country where black home ownership declined year over year, according to a recent Census Bureau report, and the percentage of Americans facing housing insecurity has risen to 9.5% from 7.2% at the end of 2020.
“A critical lesson from the Great Recession is that the communities most affected need targeted and early intervention,” the group wrote in the letter. “Acting now to include these key provisions in the pending COVID-19 relief plan will help stem what could be a damaging housing crisis in the United States, concentrated in low-income communities and communities of color. “