Groups Seek GSE Fund Foreclosure Earmark

Minority real estate groups are calling on House Financial Services Committee leaders to earmark a portion of a GSE affordable housing fund to support foreclosure prevention funds.Subprime loans are prevalent in minority and low-income neighborhoods, according to the Asian Real Estate Association of America, the National Association of Real Estate Brokers, and the National Association of Hispanic Real Estate Professionals. "The reality is that without real resources it will be extremely difficult to help many of these borrowers facing spikes in interest rates and increases in their monthly mortgage obligations," the three real estate groups say in a letter to the committee chairman, Rep. Barney Frank, D-Mass., and the ranking minority member, Rep. Spencer Bachus, R-Ala. The government-sponsored enterprise bill approved by the House committee on March 28 requires Fannie Mae and Freddie Mac to contribute annually an estimated $520 million to an affordable housing fund. During the first year, those AH funds are directed to the repair and rebuilding of affordable housing in Louisiana and Mississippi. The three groups want a portion of those contributions earmarked for loss mitigation, homeowner counseling, and foreclosure prevention.