Patrick McHenry

Mr. McHENRY

Mr. McHENRY. Mr. Chairman, I rise in opposition to the amendment.

Mr. McHENRY. In closing, Mr. Chair, I would encourage my colleagues to understand that when government taxes more and spends more, it crowds out private sector job creation and growth. We're about growing jobs in this Congress, and I urge my colleagues to get on board.

Mr. McHENRY. I would say, Mr. Chairman, my colleague is right. It is easy to be a critic of this program because it is an epic failure. I yield such time as she may consume to my colleague from Illinois (Mrs. Biggert).

Mr. McHENRY. I would say that his dissenting views are dissenting from the ranking member of Financial Services, Mr. Frank and his staff. $7,500 is what they claim. The Treasury Department claims $20,000. My colleague also said that this is a little program. That's absolutely absurd, Mr. Chairman. That's absurd. It's a $29.5 billion program of our taxpayer dollars. But you know, I think he needs to understand something, and my colleague needs to understand what this program is actually doing to people. You ask my constituent from Hickory who is in the HAMP program: We've been in the HAMP program since February of 2010 and still have no answer. We're being charged late fees, and we've been reported to the credit bureau. We've been in underwater since April and on trial payments for 6 months, which is only supposed to have been 3 months. We've not received an answer. Another constituent from Stanley said, We've paid payments every month, but now we're being told we're behind in payments because it was not the original monthly amount on our original loan, but it's the amount we were told to pay in 2010. How can we be behind? I've heard from constituents that tell the same story. It is reduced monthly trial payments. They've been rejected due to eligibility issues or lost documentation. By payments being reduced in the trial payment period, they've ended up defaulting on their mortgage. This is a Federal program that's actively harmed them. I would ask my colleague to look at the substance of the facts of this program and admit it's been a failure and vote to repeal and end this program. I reserve the balance of my time.

Mr. McHENRY. Well, let's talk about the substance of the amendment. If the sponsor will not, I intend to. The sponsor of the amendment and the amendment here says that it costs about $1,500 per mortgage modification. That is, in fact, not the case. The substance of this amendment is extremely deceptive and flawed. In fact, the statistics used within it are not even the dissenting views of the Democrats on the Financial Services Committee. They're not even the views of the Treasury Department. The Treasury Department testified in front of the Congressional Oversight Panel and said that the permanent modifications under HAMP would cost about $20,000. This amendment says $1,500. On its face it's false. I would encourage my colleagues to vote against it. I reserve the balance of my time.

Mr. McHENRY. Mr. Chairman, I rise in opposition to the amendment.

Mr. McHENRY. If the gentleman would yield, I would be happy to explain.

Mr. McHENRY. Will the gentleman yield?

Mr. McHENRY. Certainly, a multibillion-dollar Federal program doesn't create any real private sector jobs.

Mr. McHENRY. Mr. Chairman, I am not sure what my colleague from Texas has heard at her town hall meetings, but what I have heard from my constituents, I have one resident of Stanley, North Carolina, who said, ``We have paid payments every month.'' Now, I say to my colleague, I have read this before, but I wasn't sure if you were on the floor for this. But one constituent of mine said, ``We have paid payments every month. But now we are being told we are behind in our payments because it is not the original monthly payment on our original loan, but it was an amount we were told to pay in 2010. How can we be behind?'' I would ask my colleagues to read the Special Inspector General's report, ``The Details of Failures of HAMP.'' I ask my colleagues to listen to their constituents. More people in America, I would remind my colleagues, more people in America, close to 800,000 Americans, have been actively harmed and left worse off under this Federal program than have actually been helped. My colleague points to a laudable survey of the positives. The survey doesn't detail the destroyed lives that this HAMP program has pushed on people, has created. So, this amendment, the reason why I rise in opposition is because this amendment is similar to ones we have had in committee that we rejected in committee. This directs the Treasury to conduct a study of HAMP and would be completely counterproductive. The reason why it would be completely counterproductive is over the last 6 months we have seen the Treasury Department engage in a frantic 6-month media campaign for this program. They won't admit it is a failure; although, the rest of the world is largely saying it is a failure. They even have offered a veto threat on this legislation. The Special Inspector General, Mr. Barofsky, said just earlier this week, ``This Treasury Department is so content with the wretched, shameful status quo, they refuse to even acknowledge that the program is a failure.'' And that is why simply to offer the Treasury to study this really is beneath the House. I yield back the balance of my time.

Mr. McHENRY. I appreciate my colleague yielding, and I certainly appreciate the rhetoric used on the floor. I respect my colleagues. I respect their opinion. I think people of good will created this program; I really do. The intent was to help homeowners. But 2 years after the fact, we're left with the cold, hard facts that this program has hurt more people than it's helped: a Federal Government program that brings people in, destroys their credit, takes their savings, and at the end of the day takes their home. It offers hope, but it isn't able to deliver it. It's false hope that this program delivers. I would point to the Special Inspector General's report from January 26, 2011. On page 11: A combined total of more than 792,000 trial and permanent modifications have been canceled. I would also point my colleague to the Treasury Department's monthly report on their housing programs. Of the trial modifications that are canceled, those are the individuals who are brought in, given verbal modifications, and strung out for a period of months, some for 3, 6 months. I've had constituents tell me they've been in this trial modification period for up to a year. At the end of the day, these people are kicked out after their savings have been taken, and they're left with nothing, not even their homes, not their credit ratings, not their savings. It's a Federal Government program that's doing this. This is so objectionable at its core, and I have my colleagues on the other side of the aisle saying that they're bleeding heart liberals--right?--and they're making their arguments. Well, let me see if this actually burns your bleeding hearts. A constituent of mine from Kings Mountain says, ``They keep requesting the same information over and over again. They have supposedly been working with me to get approved under the Make Home Affordable Modification for over 14 months now. The person handling my case returned my call to tell me that they've declined my request for a modification because I was unemployed. I've never been unemployed. I've been with the same employer for over 5 years now, and that has not changed through this whole process. After sending her the proof of my income, she now says that I do not qualify because I am so behind on my payments. I would not be behind on my payments if they would have let me continue to pay them.'' Can you believe this is a Federal program? If that doesn't tear at your heart, if you don't see the tears of your constituents who have been put through the wringer of this Federal program--this Federal program--then I would say that every program must be acceptable then no matter how much harm it's doing. I know that we're better than that. I think the folks on the left and the right who have analyzed this program, who have done a bipartisan, nonpartisan analysis of this and research, have shown that it has been a failure. It is this Congress' responsibility to end a failure of a program and to make sure that the Federal taxpayers, the American people, don't continue to write the check for a program that destroys people's lives and that has hurt more people than it has helped. I encourage my colleagues to vote ``yes'' on this bill.

Mr. McHENRY. I thank the gentleman for yielding. There are 800,000 people that are given temporary modifications, verbal modifications, that are kicked out of the program. Those are the people that have their credit dinged and----

Mr. McHENRY. I will respond to my colleague, Mr. Chairman, that, if we can't eliminate this failed program, what program can we eliminate?

Mr. McHENRY. I thank my colleague for yielding, and responding to my colleague from North Carolina, Mr. Chairman, I would say that we agree: The HAMP program is a failure. I think there is bipartisan agreement on that. Even the SIGTARP, Mr. Barofsky, says, ``The Treasury Department is so content with the wretched, shameful status quo, they refuse to even acknowledge the program is a failure.'' We agree. It's a failure. Although it sounds like, at the end of the day, he is going to vote to defend a failed program. Secondly, I would remind my colleague that this program actually writes checks to those evil banks that he talks about, with those evil profits that he talks about, to the tune of about a billion dollars. So this program is actually cutting checks to banks. Third and finally, that TARP money is actually the taxpayer, the American people's money, not the banks' money, and we owe it to the American people to give them back that money.

Mr. McHENRY. Will the gentleman yield?

Mr. McHENRY. I think this is a fundamentally flawed amendment. What this amendment essentially does is say that the last agency in government that we had asked to conduct a review of this program would be in charge of the review of the program and would be in charge of designing a new program, even though the previous program they designed is flawed and harmful and a failure, and immediately report back to Congress a program that is basically the same. Look, Ronald Reagan once said: The closest thing to eternal life is a Federal program. That quote is this amendment. I ask my colleagues to oppose it. I reserve the balance of my time.

Mr. McHENRY. Mr. Chairman, I didn't vote for the farm bill.

Mr. McHENRY. Will the gentleman yield?

Mr. McHENRY. Thank you, Mr. Chairman. The amendment fails to highlight that there are more failed modifications than successful permanent modifications. In fact, in the dissenting views from the Financial Services Committee Democrats, of which my colleague from New York (Mrs. Maloney) signed, along with 14 of her Democrat colleagues, it states that, in their view, 570,000 homeowners would be assisted under HAMP if the program were allowed to continue. This amendment, however, states that that number is 2.8 million. This differs from the facts of her own party. And I think both numbers are much higher than what have been agreed upon by the Congressional Oversight Panel of TARP. Their numbers are much, much lower. I think if you use my colleague's words and figures, it's fair to say that those are grossly inflated and go well beyond what is reasonable, what is serious, and what is agreed upon in the private sector, or by even most of her Democrat colleagues. So I would urge my colleagues to vote against that. I reserve the balance of my time.

Mr. McHENRY. I thank the gentlewoman for yielding the time. The HAMP Termination Act, which is the legislation before us today, ends what I believe to be a failure of a government program. Not just a failure to help those 3 to 4 million homeowners that the Treasury originally set out to assist, and they've fallen well short of it--just over 500,000 mortgage modifications have taken place in the 2 years it's been in existence. Not only has it been a failure in terms of the metrics they set up to achieve the goal; it's been a failure for the very people who enter into the program and yet are pushed out. Now, I want my colleagues to understand what this government program does. The HAMP program, the Home Affordable Mortgage Program, brings folks in who are having trouble making their mortgage payments. They bring folks in, and they will give them a verbal modification for their mortgage. And what has happened--and this is what my constituents tell me and this is what the hard facts and the data indicate as well--is that a majority of those folks that enter into this program are actively harmed by this Federal program. Actively harmed. They are left materially worse off. And let me quote from the Special Inspector General for TARP, Mr. Neil Barofsky, who is a very independent-minded individual. He said that people who apply for modifications via HAMP sometimes ``end up unnecessarily depleting their dwindling savings in an ultimately futile effort to obtain the sustainable relief promised by the program guidelines. Others, who have somehow found ways to continue to make their mortgage payments, have been drawn into failed trial modifications that have left them with more principal outstanding on their loans, less home equity, or a position further underwater, and worse credit scores. Perhaps worst of all, even in circumstances where they never missed a payment, they may face back payments, penalties, and even late fees that suddenly become due on their modified mortgages that they are unable to pay, thus resulting in the very loss of their home that HAMP is meant to prevent. ``Treasury's claim that every single person who participates in HAMP gets a `significant benefit' is either hopelessly out of touch or a cynical attempt to define failure as success.'' Those are the words of the Special Inspector General designated to oversee this program and to report to Congress and the public on the success or failures of Federal programs and ways to fix them. Now, sadly, in the 2 years of this program and over 1\1/2\ years of criticism of this program, the Treasury has refused to fix it. My colleagues on the other side of the aisle have not offered legislation to fix it when they were in the majority. So we're left with what is required today, which is to root out this Federal program that spends our taxpayer dollars, yet hurts more people than it helps. One of my constituents from Hickory said, ``We've been in the HAMP program since February of 2010 and still have no answer. We're being charged late fees and we were reported to the credit bureau. We've been underwater since April and on trial payments for 6 months, which was only supposed to be 3 months. We have not yet received an answer.'' This is a Federal program. If the private sector were doing this, there would be lawsuits. If the private sector were doing that, my friends on the other side of Congress in particular would be filing legislation to make sure they were unable to do that. Instead, my colleagues on the other side of the aisle and this administration are defending a failed program. And they refused to reform it. They refused to change. They refused to improve it. They refused to do anything to it except defend it. And I believe, indeed, as the Special Inspector General said, it may be a cynical attempt to define failure as success. So I ask my colleagues to vote for this legislation and remove this costly, ineffective, and painful government program.

Mr. McHENRY. When you cut Federal spending, you create private sector jobs. When you tax people more, you get less private sector growth.

Mr. McHENRY. Mr. Chairman, in closing, I would quote from page 17 of the dissenting views of the Financial Services Committee Democrats, of which my colleague, Mrs. Maloney, signed on. Page 17, ``A reasonable estimate is that the program participation will double by the end of next year,'' which, I might add, is a bit ambitious. I'll just continue with the quote. ``A reasonable estimate is that the program participation will double by the end of next year, for a cumulative total of 1.1 million homeowners. Based on this estimate, the bill would deny modification for more than a half million homeowners at risk of foreclosure.'' I might add, the statistics also bear out that for every half a million that are helped in this program, you're actively hurting about 800,000 Americans. So what the opposition on the other side of the aisle is doing is saying we should continue failure, we should endorse failure. In fact, we should continue to hurt people by keeping this program open. And that, under their view, it means that you'll have 800,000 Americans that will be left worse off because this program exists--worse off. Their credit depleted, their home taken, their credit rating destroyed. I think that is highly inappropriate, Mr. Chairman. That's why I oppose this amendment. I yield the balance of my time to my colleague from Illinois (Mrs. Biggert).

Mr. McHENRY. Mr. Chair, I rise in opposition to the amendment.

Mr. McHENRY

Mr. McHENRY. I rise in opposition to the motion to recommit.

Mr. McHENRY. Mr. Speaker, first of all, Veterans' Administration loans are not permissible under the HAMP program. They cannot go through the HAMP program in order to get relief of their mortgage. Furthermore, veterans are already covered under an effective program which is assistance to veterans with VA guaranteed home loans. That program is actually working. The program that my colleague has offered this cynical motion to recommit for is merely a roadblock for us eliminating a failed government program. I want to tell you, the Special Inspector General for TARP has said that HAMP recipients sometimes end up unnecessarily depleting their dwindling savings in an ultimately futile effort to obtain the sustainable relief promised by the program guidelines. Others, who may have somehow found ways to continue to make their mortgage payments, have been drawn into failed trial modifications that have left them with more principal outstanding in their loans, less home equity, or a position further underwater and worse credit scores. Perhaps worst of all, even in circumstances where they never missed a payment, they may face back payments, penalties and even late fees that suddenly became due on their modified mortgages that they have been unable to pay. This Federal program that my colleagues on the other side of the aisle are standing up and defending leaves people with late fees, penalties under their modified mortgages, and oftentimes results in the loss of their very home. Furthermore, I would tell my colleagues that some have been helped in this program. But for every one person that's been helped, there's more than one other person that has actively been harmed. They deplete their savings, they ruin their credit, and their house is taken from them. And this is a government program. I ask my colleagues, do not subject our veterans, with this motion to recommit, to a failed program. We don't want our veterans to come home to a Federal program that is actively harming them. And that's what this recommit does. Furthermore, I would say to my colleagues, if we can't vote to eliminate this Federal program, I ask you, what programs can we eliminate? Vote against this recommit. Vote for final passage. Let's move on. I yield back the balance of my time.