News From Congresswoman
Nydia M. Velázquez
Representing New York's 12th Congressional District - Brooklyn, Manhattan, Queens
Ranking Democratic Member, House Small Business Committee

For Immediate Release
July 11, 2002

Contact: Wendy Belzer, James Snyder (202) 225-2361

Congressional Panel Passes Housing Reform Bill
Measure includes Velázquez proposals to aid first-time homebuyers, provide jobs for
public housing residents

WASHINGTON - The House Financial Services Committee yesterday passed H.R. 3995, the Housing Affordability for America Act, revamping federal housing programs to promote homeownership and improve the availability of affordable housing. Included in the legislation were two proposals offered by Congresswoman Nydia M. Velázquez (D-NY), a senior member of the Committee and the only New York City Democrat on the Housing Subcommittee, that would protect homebuyers and provide employment opportunities for public housing residents.

A growing crisis in New York City and across the country is predatory lending - the practice of lenders charging very high interest rates and fees, or imposing unrealistic terms - which too frequently can result in the loss of an individual's home. Nationally, default rates on federally insured mortgages have more than doubled in the last decade. This year in the New York region alone, default rates on these same loans are three times the national average. A major cause of this is predatory lending practices, and a key way to fight it is through education.

Congresswoman Velázquez's amendment would create a pilot program in New York to provide first-time homebuyers in high foreclosure areas with loan counseling and aid before they purchase a new home.

"Education is power," Congresswoman Velázquez said. "And with this new program, we will empower individuals to ask the right questions and protect themselves from the unscrupulous practices that could turn the American dream of homeownership into a nightmare."

Congresswoman Velázquez's other proposal would increase work opportunities for public housing residents. With the city-wide unemployment rate of 7.7 percent - its highest in two years - it is more important than ever to provide working families with job opportunities. Under current law, a portion of funds used for the repair, construction and maintenance of public housing are to be used to employ residents who live there. Unfortunately, due to ambiguity in this law, few residents, if any, ever see these benefits. The Velázquez amendment would set aside 30 percent of all labor costs on contracts worth more than $500,000 to hire eligible residents.

"The Housing Affordability for America Act will improve access to safe, affordable housing for people in New York City - and across the country," Congresswoman Velázquez said. "Owning a home is a vital part of the American dream. Through sound legislation action, education and community outreach, minorities and low-income individuals can turn their homeownership dreams into reality."

The legislation is scheduled for consideration by the full House as early as next week.

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