55D - RESO HOMEOWNERSHIP PRESERVATION

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REQUEST FOR COUNCIL ACTION CITY COUNCIL MEETING DATE: MARCH 3, 2008 TITLE: RESOLUTION IN SUPPORT OF HOMEOWNERSHIP PRESERVATION EFFORTS c CITY MANAGER RECOMMENDED ACTION CLERK OF COUNCIL USE ONLY: APPROVED ^ As Recommended ^ As Amended ^ Ordinance on 1 S` Reading ^ Ordinance on 2"d Reading ^ Implementing Resolution ^ Set Public Hearing For CONTINUED TO FILE NUMBER Adopt a resolution in support of federal, state, local government and private sector efforts to address homeownership preservation. DISCUSSION The preservation of homeownership has taken on additional significance this past year as sub-prime mortgage lending has impacted homeowners throughout the United States. Santa Ana has taken a leadership role in Orange County to assure that our residents are able to access all available information and resources to enable them to make informed decisions regarding their home and sub-prime or adjustable rate home mortgage. Most recently, an outreach and educational event drew the attendance of over 400 affected homeowners. It is expected that efforts underway to preserve homeownership in Santa Ana will also benefit from a package of initiatives introduced by the federal adminstration which include: • Modernization of the Federal Housing Administration (FHA) to allow greater numbers of households to access FHA mortgage insurance. • Reform of the Internal Revenue Code, to exclude the forgiveness of mortgage debt as taxable income and to allow cities and states to issue tax-exempt mortgage bonds to allow the refinance of existing loans. • Appropriation of $180 million to support mortgage counseling for households at risk of losing their homes due to subprime mortgage loans. • Reform of Government Sponsored Enterprises like Fannie Mae and Freddie Mac to increase conforming loan limits and allow these institutions to provide further liquidity in the mortgage markets. 55D-1