04/17/2008 GAAS:187:08 FOR IMMEDIATE RELEASE Print Version | En Español | Email / Share
Gov. Schwarzenegger Issues Statement Applauding Actions Boosting Mortgage Availability in California
Governor Arnold Schwarzenegger today issued the
following statement after Fannie Mae, Freddie Mac, Wells Fargo Bank, Washington
Mutual, CitiMortgage and JP Morgan Chase announced plans to provide billions of
dollars of conforming jumbo mortgages in high cost locations. Their actions,
which allow for loans as high as $729,750, stem from the new higher federal loan
limits requested by Governor Schwarzenegger and included in the federal economic
stimulus package signed by the President earlier this year.
"No single issue affects California's housing recovery more than access to mortgage
credit that fits California's home prices. These actions will
help more California families achieve the dream of
homeownership and provide another tool in our effort to reduce
foreclosures.
"I urged Congress to raise the conforming loan limits in
order to provide Californians with more affordable mortgage options and I'm very
pleased that call to action was answered, but I continue to urge the federal
government to make these new higher limits
permanent.
"Mortgage availability is critical to our housing
market's recovery. I commend Fannie Mae, Freddie Mac, Wells Fargo, Washington
Mutual, CitiMortgage and JP Morgan Chase for giving Californians living in
high-cost markets more affordable mortgage
choices."
To help Californians hit hard by the mortgage crisis,
the Governor has:
- Led efforts urging Congress and the Bush Administration to raise federal loan limits. Last fall, the Governor sent a letter calling on Congress to increase those limits and sent a similar letter again earlier this year. After Congress and the President approved a temporary increase, the Governor asked them to make the increase permanent. In February, the Governor met with the U.S. Department of Housing and Urban Development Secretary in Washington D.C. to reiterate the importance of a permanent loan limit increase.
- Announced $69.5 million in permanent low-interest loans from the Proposition 1C housing bonds to jumpstart 14 affordable multi-family projects up and down the state, helping more than 1,000 California families and individuals realize the dream of an affordable rental home.
- Announced more than $72 million in federal HOME Investment Partnerships Program funds to provide assistance to first-time homebuyers, reduce the number of bank owned homes and increase the number of rental properties.
- Joined the OneCalifornia Foundation to announce a bridge loan fund for homeowners facing foreclosure in Oakland.
- Launched a $1.2 million public awareness campaign to help educate homeowners about options that can help them avoid losing their homes to foreclosures.
- Announced an agreement with major loan servicers to streamline the loan modification process for subprime borrowers living in their homes.
- Signed legislation to increase protections for Californians who own or plan to purchase homes and to expand affordable housing opportunities.
- Issued new regulations to protect borrowers, which requires lenders to consider a borrower's ability to repay at the higher reset interest rate and mandates closer scrutiny of risk features such as interest only payments, reduced documentation and simultaneous second liens.
- Established the Interdepartmental Task Force on Non-traditional Mortgages to ensure a comprehensive and coordinated approach to the issues raised by subprime loans.
