Senator Clinton Introduces the American Home Ownership Preservation Act

Senator Hillary Rodham Clinton on September 28, 2007, introduced the American Home Ownership Protection Act before the Senate. The bill contains proposals that would regulate the unscrupulous mortgage brokers, see to that the borrower would have more disclosure of the facts about their mortgage as well as better information on the people who are issuing the mortgage

The bill would set aside funding to be used to supplement foreclosure relief and also to be used to help with preventive efforts at the state level. The funds would also be used to support for affordable housing funds across the country.

Some of the main points of The American Home Ownership Protection Act are:

To Ensure Full Disclosure of Mortgage Broker Compensation to Homebuyers

The bill will require that the mortgage broker tell the homebuyers how their compensation increases when they direct the homebuyer to a mortgage with higher fees and rates.

Require Federal Registration for Mortgage Brokers

Right now, there is no national database for information concerning any individual mortgage brokers. The proposed data base would make it possible for prospective borrowers to check up on a broker's employment history, violations, complaints, and other information to make it easier for them to make an informed decision.

Eliminate Abusive Prepayment Penalties on all Mortgages

Subprime and other non traditional mortgages often have pre payment penalties. These can increase the risk of defaulting on a mortgage. They can lock a borrower into loans until both the rates and payments escalate.

Prevent Foreclosures

The Clinton bill would provide for the establishment of a $1billion fund to help existing state programs that help borrowers who are classified as at-risk to avoid foreclosure.

There are many states who have partnerships in place with the nonprofit sector and housing industry to help borrowers renegotiate the terms of their loans, get up to date on their payments or to proved them with counseling if they need or want it

Expand Fannie Mae's and Freddie Mac's Foreclosure Prevention Efforts