FORECLOSURE PREVENTION AND INTERVENTION: THE IMPORTANCE OF LOSS MITIGATION STRATEGIES IN KEEPING FAMILIES IN THEIR HOMES FIELD HEARING BEFORE THE SUBCOMMITTEE ON HOUSING AND COMMUNITY OPPORTUNITY OF THE COMMITTEE ON FINANCIAL SERVICES U.S. HOUSE OF REPRESENTATIVES ONE HUNDRED TENTH CONGRESS FIRST SESSION NOVEMBER 30, 2007 Printed for the use of the Committee on Financial Services Serial No. 110–81 ( U.S. GOVERNMENT PRINTING OFFICE 40–433 PDF WASHINGTON : 2008 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800 Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001 VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00001 Fmt 5011 Sfmt 5011 K:\DOCS\40433.TXT HFIN PsN: TERRIE HOUSE COMMITTEE ON FINANCIAL SERVICES BARNEY FRANK, Massachusetts, Chairman PAUL E. KANJORSKI, Pennsylvania SPENCER BACHUS, Alabama MAXINE WATERS, California RICHARD H. BAKER, Louisiana CAROLYN B. MALONEY, New York DEBORAH PRYCE, Ohio LUIS V. GUTIERREZ, Illinois MICHAEL N. CASTLE, Delaware NYDIA M. VELA´ ZQUEZ, New York PETER T. KING, New York MELVIN L. WATT, North Carolina EDWARD R. ROYCE, California GARY L. ACKERMAN, New York FRANK D. LUCAS, Oklahoma JULIA CARSON, Indiana RON PAUL, Texas BRAD SHERMAN, California STEVEN C. LATOURETTE, Ohio GREGORY W. MEEKS, New York DONALD A. MANZULLO, Illinois DENNIS MOORE, Kansas WALTER B. JONES, JR., North Carolina MICHAEL E. CAPUANO, Massachusetts JUDY BIGGERT, Illinois RUBE´ N HINOJOSA, Texas CHRISTOPHER SHAYS, Connecticut WM. LACY CLAY, Missouri GARY G. MILLER, California CAROLYN MCCARTHY, New York SHELLEY MOORE CAPITO, West Virginia JOE BACA, California TOM FEENEY, Florida STEPHEN F. LYNCH, Massachusetts JEB HENSARLING, Texas BRAD MILLER, North Carolina SCOTT GARRETT, New Jersey DAVID SCOTT, Georgia GINNY BROWN-WAITE, Florida AL GREEN, Texas J. GRESHAM BARRETT, South Carolina EMANUEL CLEAVER, Missouri JIM GERLACH, Pennsylvania MELISSA L. BEAN, Illinois STEVAN PEARCE, New Mexico GWEN MOORE, Wisconsin, RANDY NEUGEBAUER, Texas LINCOLN DAVIS, Tennessee TOM PRICE, Georgia ALBIO SIRES, New Jersey GEOFF DAVIS, Kentucky PAUL W. HODES, New Hampshire PATRICK T. MCHENRY, North Carolina KEITH ELLISON, Minnesota JOHN CAMPBELL, California RON KLEIN, Florida ADAM PUTNAM, Florida TIM MAHONEY, Florida MICHELE BACHMANN, Minnesota CHARLES A. WILSON, Ohio PETER J. ROSKAM, Illinois ED PERLMUTTER, Colorado THADDEUS G. McCOTTER, Michigan CHRISTOPHER S. MURPHY, Connecticut KEVIN McCARTHY, California JOE DONNELLY, Indiana ROBERT WEXLER, Florida JIM MARSHALL, Georgia DAN BOREN, Oklahoma JEANNE M. ROSLANOWICK, Staff Director and Chief Counsel (II) VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00002 Fmt 5904 Sfmt 5904 K:\DOCS\40433.TXT HFIN PsN: TERRIE SUBCOMMITTEE ON HOUSING AND COMMUNITY OPPORTUNITY MAXINE WATERS, California, Chairwoman NYDIA M. VELA´ ZQUEZ, New York SHELLEY MOORE CAPITO, West Virginia JULIA CARSON, Indiana STEVAN PEARCE, New Mexico STEPHEN F. LYNCH, Massachusetts PETER T. KING, New York EMANUEL CLEAVER, Missouri JUDY BIGGERT, Illinois AL GREEN, Texas CHRISTOPHER SHAYS, Connecticut WM. LACY CLAY, Missouri GARY G. MILLER, California CAROLYN B. MALONEY, New York SCOTT GARRETT, New Jersey GWEN MOORE, Wisconsin, RANDY NEUGEBAUER, Texas ALBIO SIRES, New Jersey GEOFF DAVIS, Kentucky KEITH ELLISON, Minnesota JOHN CAMPBELL, California CHARLES A. WILSON, Ohio THADDEUS G. McCOTTER, Michigan CHRISTOPHER S. MURPHY, Connecticut KEVIN McCARTHY, California JOE DONNELLY, Indiana BARNEY FRANK, Massachusetts (III) VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00003 Fmt 5904 Sfmt 5904 K:\DOCS\40433.TXT HFIN PsN: TERRIE VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00004 Fmt 5904 Sfmt 5904 K:\DOCS\40433.TXT HFIN PsN: TERRIE C O N T E N T S Page Hearing held on: November 30, 2007 ........................................................................................... 1 Appendix: November 30, 2007 ........................................................................................... 91 WITNESSES FRIDAY, NOVEMBER 30, 2007 Albon, Michaela, Senior Vice President and General Counsel, Home Loans Division, Washington Mutual ............................................................................. 37 Arnold, LeFrancis, Vice Chair, Affordable Housing Committee, California As- sociation of Realtors ............................................................................................. 72 Bates, Joseph C., Director, Santa Ana Homeownership Center, U.S. Depart- ment of Housing and Urban Development ......................................................... 15 Blackwell, Brad, Executive Vice President, Wells Fargo Home Mortgage ......... 39 Burnie, Evalyn, Leader, Los Angeles ACORN, accompanied by Richard Cas- tro, NeighborWorks America ............................................................................... 79 Cho, Hee Suk, Homeowner, Camarillo, California, accompanied by Joshua Byung An, Korean Churches for Community Development, serving as a translator .............................................................................................................. 68 Clark, Yolanda, President-Elect, Multicultural Real Estate Alliance for Urban Change .................................................................................................................. 74 Deutsch, Tom, Deputy Executive Director, American Securitization Forum ..... 41 Frisbee, Margaret, Pacific District Director, NeighborWorks America ............... 78 Heedly, William, Homeowner, Carson, California ................................................ 67 Herrera, Pastor, Director, Department of Consumer Affairs, Los Angeles County ................................................................................................................... 21 Krimminger, Michael H., Chairman’s Special Advisor for Policy, Federal De- posit Insurance Corporation ................................................................................ 17 Lee, Karen, Homeowner, Los Angeles, CA ............................................................ 44 Leonard, Paul, California Office Director, Center for Responsible Lending ....... 45 Peters, Heather, Deputy Secretary for Business Regulation, Department of Business, Transportation, and Housing, State of California ............................ 19 Rogan, Sean, Director, Department of Housing and Community Development, City of Oakland, California ................................................................................. 22 Samuels, Sandor, Executive Managing Director, Countrywide Financial Cor- poration ................................................................................................................. 35 Smith, Ed, Jr., Vice President, California Association of Mortgage Brokers ..... 70 Thomas, Anna M., Homeowner, San Pedro, CA ................................................... 44 Twomey, Tara, Of Counsel, National Consumer Law Center .............................. 76 Villaraigosa, Hon. Antonio R., Mayor of Los Angeles, California ........................ 12 Young, Hon. Anthony, City Council President Pro Tempore, San Diego, Cali- fornia ..................................................................................................................... 10 APPENDIX Prepared statements: Lantos, Hon. Tom ............................................................................................. 92 Albon, Michaela ................................................................................................ 94 Bates, Joseph C. ............................................................................................... 99 Blackwell, Brad ................................................................................................. 103 Deutsch, Tom .................................................................................................... 108 Frisbee, Margaret ............................................................................................. 113 Herrera, Pastor ................................................................................................. 121 (V) VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00005 Fmt 5904 Sfmt 5904 K:\DOCS\40433.TXT HFIN PsN: TERRIE VI Page Prepared statements—Continued Krimminger, Michael H. .................................................................................. 125 Lee, Karen ......................................................................................................... 141 Samuels, Sandor ............................................................................................... 142 Smith, Ed, Jr. ................................................................................................... 157 Twomey, Tara ................................................................................................... 165 Villaraigosa, Hon. Antonio R. .......................................................................... 176 Young, Hon. Anthony ....................................................................................... 188 ADDITIONAL MATERIAL SUBMITTED FOR THE RECORD Waters, Hon. Maxine: Statement of the NAACP ................................................................................. 190 VerDate 0ct 09 2002 18:38 Feb 21, 2008 Jkt 040433 PO 00000 Frm 00006 Fmt 5904 Sfmt 5904 K:\DOCS\40433.TXT HFIN PsN: TERRIE FORECLOSURE PREVENTION AND INTERVENTION: THE IMPORTANCE OF LOSS MITIGATION STRATEGIES IN KEEPING FAMILIES