BILL NUMBER: AJR 40	CHAPTERED
	BILL TEXT

	RESOLUTION CHAPTER  140
	FILED WITH SECRETARY OF STATE  SEPTEMBER 18, 2012
	APPROVED BY GOVERNOR  SEPTEMBER 18, 2012
	ADOPTED IN SENATE  AUGUST 30, 2012
	ADOPTED IN ASSEMBLY  JULY 5, 2012

INTRODUCED BY   Assembly Member Skinner
   (Coauthors: Assembly Members Beall, Block, Blumenfield, Buchanan,
Charles Calderon, Chesbro, Dickinson, Eng, Huffman, Lara, Ma, Perea,
and Williams)

                        MAY 15, 2012

   Relative to mortgages.


	LEGISLATIVE COUNSEL'S DIGEST


   AJR 40, Skinner. Mortgages.
   This measure would urge the Federal Housing Finance Agency, and
specifically its director, Edward DeMarco, to immediately allow the
Federal National Mortgage Association and the Federal Home Loan
Mortgage Corporation to offer principal reductions to homeowners who
owe more on their home loans than what their homes are worth.



   WHEREAS, Since 2008, more than half a million Californians have
lost their homes to foreclosure and another half million homes are
currently in foreclosure or are at imminent risk of foreclosure; and
   WHEREAS, There are over 2 million California homes currently
"underwater" where property owners owe more than what the home is
worth and collectively the value of these homes is over $196 billion;
and
   WHEREAS, Foreclosures too often become vacant, boarded-up hazards,
lower surrounding property values, increase criminal activity in
neighborhoods, and discourage economic development and investment in
communities; and
   WHEREAS, The wave of foreclosures that has already hit California
substantially decreased tax revenue, which led to budget deficits,
increased unemployment, and billions of dollars in cuts to schools,
health services, and other vital services; and
   WHEREAS, The Federal Housing Finance Agency oversees the Federal
National Mortgage Association (Fannie Mae) and the Federal Home Loan
Mortgage Corporation (Freddie Mac), the two companies that control
over one-half of the home loans in the United States, and
specifically over 60 percent of California mortgages; and
   WHEREAS, The director of the Federal Housing Finance Agency,
Edward DeMarco, has steadfastly opposed allowing Fannie Mae or
Freddie Mac to offer principal reductions to homeowners who owe more
on their homes than what they are worth; and
   WHEREAS, On February 9, 2012, Attorney General Kamala Harris
announced that California will join a national servicing settlement
that is estimated to provide up to $40 billion in benefits to
borrowers across the country and much of these benefits include a
program of principal reductions; and
   WHEREAS, Fannie Mae and Freddie Mac refused to participate in the
national settlement agreement, meaning more than one-half of the home
loans in the country will see no relief from this agreement; and
   WHEREAS, Many economists and housing experts agree that principal
reductions are the most helpful tool for limiting the number of
foreclosures; and
   WHEREAS, By refusing to allow principal reductions, the Federal
Housing Finance Agency is ensuring that tens of millions of
homeowners nationwide will continue to owe more on their home loans
than what their homes are worth; and
   WHEREAS, Allowing principal reductions for Fannie Mae and Freddie
Mac mortgages could deter another wave of costly foreclosures
nationwide; now, therefore, be it further
   Resolved by the Assembly and the Senate of the State of
California, jointly, That the Legislature urges the Federal Housing
Finance Agency, and specifically its director, Edward DeMarco, to
immediately allow the Federal National Mortgage Association and the
Federal Home Loan Mortgage Corporation to offer principal reductions
to homeowners who owe more on their home loans than what their homes
are worth; and be it further
   Resolved, That all cities and counties in California that suffer
the effects of foreclosures along with the individual homeowners
involved should also be engaged in efforts to convince the Federal
Housing Finance Agency to offer principal reductions as a means of
preventing further economic and societal harm to our communities; and
be it further
   Resolved, That the Chief Clerk of the Assembly transmit copies of
this resolution to the President and Vice President of the United
States, to the Speaker of the House of Representatives, to the
Majority Leader of the Senate, the Director of the Federal Housing
Finance Agency, to each Senator and Representative from California in
the Congress of the United States, and to the author for appropriate
distribution.