Strolling up Eutaw Place, Rep. Elijah E. Cummings counts the For Sale signs. More than a dozen brightly colored placards pepper a typical block of the street where young professionals rent or own generally well-kept townhouses.
The Baltimore Democrat, who lives a couple of streets away and maintains a district office nearby, says the combination of mortgage difficulties, falling property values and tightening credit is fueling turmoil in his neighborhood. He says he can hear the pain in the voices of the constituents who call for help.
"The problem is bad," Cummings said. "When these people are foreclosed upon, not only are their dreams killed, but their hopes are, too."
While Congress debates how to confront the housing crisis, Cummings says he is developing legislation that would channel federal dollars toward a new state program that provides no-interest loans to help homeowners catch up on delinquent mortgage payments. Democratic Gov. Martin O'Malley announced the Bridge to Hope program in January with $400,000 in initial funding; Cummings wants to bolster that with several million dollars more.
It's one of several efforts by Maryland's congressional delegation to address a national crisis that has hit the state hard. Nearly one in five of Maryland's subprime mortgage borrowers are behind in their payments, according to figures released yesterday by the Mortgage Bankers Association.
Tens of thousands of those loans are expected to go into foreclosure in the next two years, according to the Joint Economic Committee of Congress, costing the state $2.7 billion in lost property value and $19 million in property taxes.
During the last three months of 2007, Maryland saw 9,722 "foreclosure events" - notices of mortgage loan defaults, notices of foreclosure sales and lender purchases of foreclosed properties - according to RealtyTrac.com.
The "foreclosure events" number represents a 13-fold increase over the corresponding period the year before.
U.S. Sen. Benjamin L. Cardin, who held a conference call last month with Maryland housing counselors, co-sponsored the Democratic housing bill that was blocked by Senate Republicans last week over a controversial proposal to allow bankruptcy judges to rewrite some loans.
"I think it defies logic not to give some discretion to the bankruptcy judges," said Cardin, a Democrat. "It's difficult to explain to a debtor going into bankruptcy why a vacation home can be adjusted but their prime residence cannot."
Sen. Barbara A. Mikulski, who has held housing roundtables in Baltimore and Prince George's counties, wants to add more money for legal assistance to homeowners when Democrats revive that legislation.
"People are under siege," said Mikulski, also a Democrat. "But the people who are trying to help them, both the nonprofit agencies that do housing counseling as well as those that try to provide some legal services to provide a way forward, a workout plan, are also stretched to the limit."
Cummings, who describes his parents' move from a small rental home in South Baltimore to their own house in Edmondson Village as a turning point in his life, says that a pilot program to channel federal dollars into the state's Bridge to Hope program could give borrowers who are having difficulty making payments a way to avert disaster.
A $3,000 no-interest loan to a borrower in danger of foreclosure, he says, can be worth much more in expenses avoided.
"That will get that person from one point to the other," he said. "And will help them not lose their house, will help them avoid a situation where they may never be able to buy a house again."
But Congress, which worked quickly last month to approve an economic stimulus package, has had more difficulty building consensus on measures to address the housing crisis.
There is broad support for increasing funding for housing counseling and allowing communities to purchase and renegotiate troubled mortgages.
But Democrats and Republicans have been unable to agree on the amount of money that should be given to communities to buy and rehabilitate foreclosed homes. And Republicans oppose the Democratic proposal to give bankruptcy judges the authority to cut interest rates on troubled loans and reduce the total amount owed, which critics say will lead lenders to increase interest rates.
That approach has attracted a veto threat from the White House, and led Republican senators to block the Foreclosure Prevention Act on a procedural vote last week. Senate Democrats are promoting a compromise that would limit the types of loans that could be rewritten.
The St. Ambrose Housing Aid Center is one of several agencies nationwide that are eligible for the $180 million Congress has made available for housing counseling through the end of the year.
But with a caseload that doubled to 2,200 clients last year and is on a pace to double again this year, deputy director Lisa Evans says the Baltimore nonprofit and similar agencies are looking for more funding and more consistent funding.
"There's not enough either counseling or legal resources for the clients that are seeking help," she said. St. Ambrose is looking to hire two more attorneys to join the two now on staff, but Evans said the limited funding window makes it difficult to recruit, hire and train candidates.
"I don't think the crisis is going to end Dec. 31," she said.
Clarence J. Snuggs, deputy secretary of the Maryland Department of Housing and Community Development, agrees on the value of counseling. The state is seeking congressional approval to use $800,000 in leftover disaster recovery funds from Tropical Storm Isabel to expand its capacity to counsel borrowers.
But Snuggs says he would welcome anything the federal government can do to stabilize the housing market.
"In a general sense, what we're looking for is some relief," he said.