Valley Demos assail housing official

WASHINGTON -- The Obama administration continues to frustrate Central Valley lawmakers, who charge the White House with doing too little, too late for the region's foreclosure epidemic.

And these are fellow Democrats talking.

On Thursday, the long-simmering tensions boiled over again as 17 unhappy House members, including Reps. Dennis Cardoza, D-Atwater; Jim Costa, D-Fresno; and Doris Matsui, D-Sacramento, confronted one of the president's top housing honchos. The lawmakers wanted new programs, but they didn't get them.

"I am dismayed that there is no program that will adequately address the housing crisis," Cardoza said following the meeting, adding that the administration shows a "lack of understanding and lack of urgency … that's unacceptable."

The 17 House members, all Democrats and most of them from California, had summoned Edward DeMarco, acting director of the Federal Housing Finance Agency, to a private Capitol Hill briefing on what the administration planned to do next for California's housing woes.

In a meeting punctuated by loud voices and an occasional fist pounding on the table, according to participants, DeMarco absorbed the rhetorical punches and then promised to come back by the end of the month with a new plan.

"He knows we're not satisfied," Costa said. "He knows we're sick and tired of the administration's inability to provide meaningful fixes for the housing crisis."

DeMarco, and the Obama administration in general, already had irked the valley lawmakers. Last month, the administration sent lower-ranking officials to meet with the House members who had asked to meet with DeMarco himself.

The apparent brush-off particularly displeased California representatives, whose congressional districts are frequently described as "ground zero" for the mortgage and foreclosure crisis. Foreclosure rates in the Modesto, Stockton, Merced and Sacramento metropolitan areas have consistently ranked in the top 10 nationwide.

The Bush administration, too, had angered the region's lawmakers with mortgage assistance programs they deemed inadequate and poorly targeted. At one point, Merced failed to land targeted mortgage assistance funds though it ranked second in the nation for foreclosures.

But DeMarco, a longtime federal employee with a doctorate in economics, also has a difficult balancing task. While lawmakers press for more help with their constituents' mortgages, his responsibilities include protecting what remains of Fannie Mae and Freddie Mac, the mortgage giants now under federal conservatorship.

"The model on which they were built is now broken beyond repair," DeMarco said at a housing conference in North Carolina last month.

The Obama administration has previously tried several mortgage assistance programs. The Home Affordable Modification Program, begun in 2009, has helped cut interest payments or made other revisions to about 357,000 mortgages nationwide. The Home Affordable Refinance Program has helped about 838,000 homeowners refinance.

In his North Carolina speech, DeMarco called the number of mortgages refinanced through the Home Affordable Refinance Program "meaningful" but acknowledged it was also "fewer than expected." One new proposal under discussion has been to expand HARP so that some borrowers could refinance into lower-rate loans even if they owe greater than 125 percent more than what their home is worth.

"There are several challenging issues to work through here and the outcome of this review is uncertain," DeMarco said in his North Carolina speech.

On Thursday, lawmakers said DeMarco cautioned the plan he will return with might only be able to help 600,000 to 1 million homeowners nationwide. One of the meeting's organizers, Rep. Elijah Cummings, D-Md., estimated this might only cover about one-tenth of the national need.

"There's so much left to be said," Cummings said. "There's so much left to be done."

Bee Washington Bureau reporter Michael Doyle can be reached at mdoyle@mcclatchydc.comor (202) 383-0006.