'TARP for Main Street' legislation introduced in House

A bill to provide low-cost loans to unemployed homeowners with delinquent mortgages was introduced yesterday by Rep. Barney Frank, D.-Mass., chairman of the House Financial Services Committee. The bill, HR 3068, dubbed “TARP for Main Street,” would direct $2 billion of funds from the Troubled Asset Relief Program to emergency loans and assistance to homeowners who don’t qualify for other mortgage aid programs because they are unemployed. The borrower’s home would be the collateral. In addition, the bill would provide another $2 billion to stabilize mortgages for multifamily properties that are in default or foreclosure. The bill would direct $1 billion from dividends generated by TARP to fund the National Affordable Housing Trust Fund, which was established last year to preserve and build affordable housing, and $1.5 billion for the Neighborhood Stabilization program for the redevelopment of foreclosed and abandoned properties. Money being repaid to TARP by aid recipients is going to the Department of the Treasury. The bill would redirect some of the dividend money to fund the affordable-housing initiatives, said Steven Adamske, a spokesman for Mr. Frank’s office. “The bill would be taking that money and using it to help people with affordable housing and affordable rental housing,” Mr. Adamske said. “The American people should realize those profits.” Mr. Frank and others in Congress are still frustrated by the lack of progress in efforts to help homeowners avoid foreclosure, Mr. Adamske said. Mr. Frank hopes to schedule the bill for markup by the committee by the end of this month, the spokesman said. Dividend payments from institutions that received TARP funding totaled $6.2 billion as of June 12, according to the Government Accountability Office.