Cohen Authors Bill to Prevent Foreclosures in Memphis, Across the Country

WASHINGTON, D.C. – Congressman Steve Cohen (TN-9) today authored legislation to establish a grant program for state and local governments to help provide mediation between homeowners and lenders in an effort to help prevent foreclosures in Memphis and across the country. The Associated Press is reporting that more than 1 million American households are likely to lose their homes to foreclosure in 2010.

“Memphis has been hit hard by foreclosures,” said Congressman Cohen. “Foreclosures evaporate middle class wealth. My bill would help families keep their homes and avoid the stress and difficulties of foreclosure.”

Congressman Cohen’s legislation -- the Preventing Homeowners from Foreclosure Act of 2010 -- would create a grant program to help local communities establish foreclosure mediation programs. Foreclosure mediation would postpone Sheriff sales of all owner-occupied residences until the homeowner has had an opportunity to meet with a housing counselor to explore viable alternatives to foreclosure.

The program would also establish an outreach program to raise homeowner awareness of the mediation program. Any state or local government that receives help from this grant program would be required to keep a record of each mediation carried out, including the nature of any loan modification.

The measure comes at a time when the U.S. Department of the Treasury's anti-foreclosure program -- the Home Affordable Modification Program -- is not living up to its potential. A report released in May showed more than twice as many homeowners were kicked off the Home Affordable Modification Program as were granted relief.