In announcing that the month of June would be the first ever National Homeownership Month, Secretary of Housing and Urban Development Mel Martinez said, "A healthy economy depends on a vigorous, growing housing sector, and ...housing continues to fuel the nation's economy,"

In making this statement Martinez highlighted a new study by the Homeownership Alliance, which concluded that even at the state and local level, the strength of housing has helped to mitigate the recent economic slowdown and even stimulate economic recovery.

Homeownership is an integral component of the American Dream, and lending institutions have been resourceful in finding ways to help consumers purchase homes.  Unfortunately, the rising cost of real estate is making it increasingly difficult for some lower and middle income individuals from realizing this dream.  Recently, I introduced legislation which aims to foster home buying, which will strengthen our economy as it strengthens families.

Throughout our history, Congress has acted when steps were needed to increase homeownership.  I believe we must do so again.  We must address the cost private mortgage insurance and assist our volunteer and career firefighters with the purchase of a home.

First-time homeowners too often are discouraged from home buying by the soaring costs and expenses involved.  Many find themselves forced to put down a minimal percentage of the purchase price as a down payment, triggering the need to pay private mortgage insurance (PMI) on top of their monthly mortgage payments.

Merely paying lip service to middle class families about the tax code is no longer acceptable. That is why I have introduced H.R. 149, legislation that amends the Internal Revenue Code of 1986 to allow a tax deduction for premiums on private mortgage insurance.

Lenders generally require PMI whenever the buyer puts less than a 20% down payment on the purchase price of the house.  The insurance covers the lender in the event of default by the borrower. Homeowners themselves receive no direct coverage from the insurance, even though they pay for it. Most consumers pay for the insurance as an added charge, typically $50 to $100 more per month. About 5 million homeowners pay private mortgage insurance (PMI) premiums every month.

Unlike mortgage payments, PMI premium payments are not tax deductible. If these homeowners were able to deduct the $800 or $1,200 a year they pay in premiums, they'd save hundreds of dollars in taxes per year.

We must also step up and assist America's first responders in buying a home.  Firefighters are a central part of every community, and decline in volunteer firefighters nationwide is a problem that should concern all of us.  According to the National Volunteer Fire Council, the number of volunteer firefighters in the United States has declined between 5-10% since 1983.  Three out of every four firefighters in America is a volunteer, and we must create incentives to help recruit the next generation. 

Career firefighters have their own unique challenges. They often protect large communities, typically in urban areas.  These communities usually have a high cost of living and correspondingly high housing costs.

Our first responders make the American dream possible for us each and every day. Its time Congress took a small step in return.  Under my "Firefighters Affordable Housing Act." all volunteer firefighters will receive compensation that lowers their federally insured mortgage payments by 2% for their primary residence.  All professional firefighters will be eligible to make down payments on their homes as low as 1% of the purchase price and will not be required to pay mortgage insurance.

Whether it was through the creation of the Federal Home Loan Bank system to encourage lending, the Federal Housing Administration to insure lenders against losing money and standardize mortgage practices, or passage the Housing Act of 1949, Congress has worked to advance the American dream - and strengthen our economy - through homeownership.  Its time to do so again.
 

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