GOP Targets Irresponsible Borrowers
House Republicans on Thursday will force lawmakers to vote on whether people who received “liar loans,— or people who misrepresented their income to qualify for a mortgage, should be eligible for federal housing aid.
Republicans will seek the vote in their motion to recommit during this afternoon’s debate on foreclosure prevention legislation. Specifically, the motion seeks to prohibit federal aid from going to people who misrepresented their income on mortgage applications or to lenders that didn’t follow underwriting standards.
It also seeks to prohibit the use of taxpayer funds from being used as incentives to lenders to rework loans for irresponsible borrowers. The motion also ties federal aid to President Barack Obama submitting a plan that “provides equitable treatment of all mortgagors.—
Financial Services ranking member Spencer Bachus (R-Ala.) criticized Democratic leaders for intentionally crafting the bill “to do something to help people who lied to get a mortgage … We think these people are the least responsible.—
The motion, which will be offered by Republican Study Committee Chairman Tom Price (R-Ga.), puts moderate Democrats in an awkward position since they already delayed the bill to ensure that its language would prevent struggling homeowners from getting an easy bailout.