Senator Kane Continues Efforts To Reduce Impact Of Mortgage Crisis In Connecticut

Serves as member of Commission on Nontraditional Loans & Home Equity Lines of Credit

Senator Rob Kane (R-32) said he is looking forward to the opportunity to contribute to the work of the Commission on Nontraditional Loans and Home Equity Lines of Credit created by the General Assembly to research how the mortgage crisis is affecting Connecticut homeowners and recommend how the state could help.

Senator Kane, a ranking member of the General Assembly’s Banks Committee, said the commission will issue its findings and recommendations in January. Members of the commission include Senator Kane, state Banking Commissioner Howard Pitkin, legislators and others knowledgeable about the banking industry.

“Among other things, the commission wants to know how many Connecticut homeowners have nontraditional loans and home equity lines of credit, and how many of these persons are in default, been affected by a foreclosure or are likely to be affected by foreclosure in the next four years. Our recommendations will address the issues regarding these types of loans and lines of credit, determine the circumstances under which nontraditional loans and home equity lines of credit are appropriate, and take into consideration the effects that our recommendations could have on responsible lending activities,” said Senator Kane.

The General Assembly created the Commission on Nontraditional Loans and Home Equity Lines of Credit as part of reform legislation passed earlier this year to mitigate the economic impact of the sub-prime lending crisis in Connecticut. In addition to establishing the commission, the new law (PA 08-176, AAC Responsible Lending and Economic Security), creates two programs to help homeowners avoid foreclosure, and authorizes the state to buy mortgages and place eligible borrowers on an affordable repayment plan.

“This is not a public bailout plan, but rather an attempt to address a problem that affects every aspect of our state and national economy. We want to clean-up the problems caused by bad loans and bad decisions, but more importantly this bill is intended to help Connecticut avoid similar problems in the future by making lending policies more transparent and uniform, and holding mortgage brokers to the same high standards as banks. The findings and recommendations of the commission will be an enormous help,” said Senator Kane.

Senator Kane stressed that the state will implement the requirements of the mortgage reform bill within available funds, and without further burdening the taxpayers.

“As always, I encourage constituents who have questions of concerns to contact my legislative office at 1-800-842-1421, or via e-mail to [email protected],” said Senator Kane.