Advocate

A Call to Action - The SAFE Act 

The SAFE Act was passed as a part of the Housing and Economic Recovery Act of 2008.  The SAFE Act requires each state to set minimum standards for licensing mortgage loan originators working in their state.  The SAFE Act clearly anticipates for-profit loan originators and is thus very complicated, and includes provisions for fingerprinting, background checks, outside training and coursework, surety bond requirements, and registration in a nationwide mortgage registry system.  

The SAFE Act includes onerous ongoing requirements that are likely to be difficult to meet for many small to mid-size Habitat affiliates and other similarly situated legitimate nonprofits.  Without more clarification, it is very likely that the SAFE Act will cause many Habitat affiliates extreme difficulty in continuing to issue mortgages.  

The SAFE Act could effectively halt Habitat's progress in the mission of bringing safe, decent affordable housing to families in California. 

Our Response

In California, we have requested (on behalf of 49 Habitat for Humanity Affiliates in California) an exemption through an interpretive opinion to the California State Department of Corporations.  In addition, Representative Heath Shuler (D-NC) has proposed a legislative fix (HR 4400) to clarify that states have the authority to grant exemptions for specific nonprofit groups who meet certain requirements:

• That are 501(c)3 nonprofit corporations;

• Who make mortgage loans to promote homeownership for poor to low-income, disabled or other disadvantaged individuals or families;

• Offers mortgage loans at interest rates that are lower than the bank prime loan rate, or that are no-interest loans or loans with interest rates significantly below the interest rates generally available in the market; and

• Are otherwise not primarily in the business of soliciting or brokering mortgage loans.

How You can Help!

Rep Shuler needs Co-Sponsors to pass HR4400.  We urge you to contact your Congressperson and ask them to be an original cosponsor of Rep. Shuler's vital legislation.

By Email:

1. Visit Habitat for Humanity International's website.

2. Fill in your contact information and your representative will be found for you based on your address and zip code.

3. Ask your representative, via the email form, to support Rep. Shuler's bill clarifying the 2008 SAFE Act.

4. If desired, refer to the "Rationale to share with members of the House of Representatives" in the section below to customize your ask. 

By Phone:

1. Identify the U.S. Representative who represents your affiliate's service area by going to www.house.gov and entering your affiliate's zip code +4 in the upper left hand corner of the page.

2. Call the Capitol switchboard at (202) 224-3121 and ask to be connected to your representative.

3. When connected to the Congressional office, ask to speak to the legislative assistant who handles housing issues.  Or, if you know the representative, ask to speak to her/him directly.

4. Identify yourself and your affiliate - Habitat for Humanity of Greater Los Angeles.  Explain the SAFE Act issue and drive home the potential unintended consequences that it could have on the work of your affiliate.  Explain Rep. Shuler's proposed solution.  The bill number is HR 4400.

5. During the call:

• If speaking with the Member of Congress, ask: Will you add your name as a cosponsor of HR 4400?

• If speaking with their housing legislative assistant, ask: Will you contact Frankie Keller in Rep. Shuler's office to add your boss as a cosponsor to HR 4400?

6. Send an email to Christopher Ptomey, HFHI and Veronica Garcia, HFH GLA and let us know if the representative intends to join as a cosponsor.  Tell us about any questions or concerns you heard regarding the bill, so that we can address them before they become an obstacle.

Rationale to share with members of the House of Representatives:

The SAFE Act specifies that it only applies to individuals working with mortgages "for compensation or gain."  Habitat has a unique mission, and does not seek to gain from its partner family homeowners.  It does not make sense to require Habitat to satisfy requirements that are focused on profit-making enterprises. 

• Habitat affiliates are nonprofit organizations, and by definition do not seek to make a profit or to gain from our partner family homeowners;

• Habitat affiliates are required to make no-profit mortgages, and to carefully screen and provide education to all partner families;

• Habitat affiliates do not include any fees that accrue to the affiliate in its no-profit mortgages, except for those fees necessary to service the mortgages.

• Even through the current housing crisis, Habitat's focus on true affordability and homeowner education has allowed our ministry to maintain an extremely low foreclosure rate.

• HR 4400 would simply restore state official's confidence in their authority to make necessary exemptions, allowing those officials who have daily contact and intimate knowledge of the work of responsible housing nonprofits to determine whether and when an exemption is warranted.

As of today, 91 Members of Congress have already decided to co-sponsor the exemption.  For more information on HR 4400, please click here and type in HR4400. 

Federal Legislative Priorities

In order to increase support for affordable homeownership and eliminate poverty housing, Habitat for Humanity International recognizes the following initiatives as legislative priorities:

• Invest in resilient communities.

• Maintain federal resources that support the work of Habitat affiliates nationwide.

• Create tenure security.

Please click here to read about the specific programs and policies attached to each initiative and what you can do to help!