Nevada lawmakers make housing a popular election year issue

By Karoun Demirjian

Sunday, March 11, 2012 | 3 a.m.

If you’re a member of Congress from Nevada and you’ve got a tough election looming, there’s a good chance you’ve recently drafted legislation on housing.

Rep. Joe Heck is the latest lawmaker to keep the trend going, releasing his Second Chance at Homeownership Act, which would give people who have already been foreclosed on a way to get home loans through the Federal Housing Administration — something their credit wouldn’t normally allow after a foreclosure.

“We need to do everything we can to help the millions of people who experienced a foreclosure or short sale due to the economic downturn regain their piece of the American dream,” Heck said in a statement. “Getting more people into homes helps communities and improving the housing market helps the state of Nevada.”

Heck’s bill comes a month after Sen. Dean Heller filed a housing bill, the Keeping Families in their Home Act, which encourages banks and government lending giants Fannie Mae and Freddie Mac to offer long-term leases of foreclosed homes — preferably to the families who were foreclosed on in those homes. The idea is that in up to five years, those families can go from being renters to owners.

“With the opportunity to rent their homes, families may not have to move out of their neighborhoods and children can stay in their same school,” Heller said when he released the bill. “While this bill is not the silver bullet to ending Nevada’s housing crisis, it is a positive step that I hope will make a difference Nevadans can feel.”

Fat chance, says Rep. Shelley Berkley, Heller’s likely Democratic challenger in November — underscoring the political matchups that are the backdrop to these proposals.

“It’s nice that Mr. Heller has in an election year finally decided to step up,” Berkley said last week when asked about Heller’s and Heck’s efforts to file housing legislation.

She said Heller’s position had been to “let the market hit bottom and don’t do anything in order to help homeowners stay in their homes,” calling him “the Johnny-come-lately on these mortgage foreclosures.”

For Berkley and Heller, whom polls show in a close race, every issue can be pivotal one.

On housing, Berkley doesn’t intend to cede any ground — even though unlike Heller and Heck, she has filed no housing bill, and hasn’t indicated that she will.

“I think my record speaks for itself,” she said. “I don’t think there’s anybody who has fought harder to keep people in their homes over the last several years.”

Instead, Berkley has used her post as co-chair of the House Democrats’ Housing Stabilization Task Force to laud many of President Barack Obama’s housing initiatives, including his latest efforts to reduce fees and push banks to make principal reductions on bad mortgages.

But she’s also ripped Obama for other plans.

Berkley and Heller both voted to wind down the federal government’s chief mortgage modification program, HAMP, a year ago, before the Obama administration expanded it to allow more distressed property owners, like many in Nevada, to take advantage of it. Even now, Berkley is calling on Obama to fire Federal Housing Finance Agency chief Ed DeMarco because he isn’t doing enough on mortgage principal reduction — seen by most economists as the only way Nevada’s underwater homeowners will be able to wrestle the local housing market back from the brink.

“As the chairman of the housing caucus, I’ve had dealings with this man and he has been impossible to deal with,” Berkley said.

In a state that continues to lead the nation in foreclosure and the share of homeowners underwater, housing could play an important role in Nevada’s congressional races.

Here’s how Berkley and Heller’s records shape up:

Berkley voted for HAMP as part of the stimulus bill in 2009, which Heller voted against. They parted ways on votes to authorize the administration’s Neighborhood Stabilization Program, allow bankruptcy judges to modify existing mortgages, to offer emergency, zero-interest home loans to underwater homeowners through the Department of Housing and Urban Development, and to fund an FHA program to convert underwater mortgages to FHA-backed ones. In each case, Berkley voted in favor of the programs, while Heller voted against, arguing in at least one case that: “The program is not working for our state.”

They came together, however, to vote for tax relief on mortgage write-downs, short sales and foreclosures.

Heck, meanwhile, has been the least partisan on housing of the Nevada delegation in Congress. He’s sided with the Republicans on emergency HUD loan programs. But when Berkley and Heller voted to end HAMP, for example, Heck voted to keep it — and was the only Republican to vote for FHA conversions of underwater loans too.

Neither Heller’s nor Heck’s bills address mortgage write-downs. So far, that’s been the president’s turf, especially in the wake of last month’s settlement with Bank of America and other private lending giants that has put billions of dollars toward mortgage modification.

Heller and Heck didn’t comment on the president’s plans.

Berkley, however, has called Obama’s recent announcement — a remedy to wrongfully foreclosed-upon veterans — “an important step.”