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CHARLOTTE – U.S. Housing and Urban Development Secretary Shaun Donovan said he believes the $25 billion settlement the government reached with five banks this year will help stabilize the housing market and the economy.

"It's in everyone's interest to have a clear, strong set of rules that everyone lives by," he said in an interview Monday.

More than 300 of those rules will take effect Tuesday on some of the nation's biggest lenders, including Bank of America and Wells Fargo.

The settlement is designed to stop problems homeowners experienced before falling into foreclosure.

"They got passed from one person to another and nobody had real responsibility to help them," Donovan said, after a speech to credit counselors, who are meeting for a conference in Charlotte.

He said 8.5 million families took advantage of counseling during the recession. Many saved money, and their homes, by doing so.

"They put that money into local businesses,” said Donovan. “They spend it fixing their roof, they spend that at the corner market."

Credit counselors said three out of four homeowners who seek help are able to stay in their homes.

"The settlement should offer more consistency and uniformity,” said Susan Keating, president of the National Foundation for Credit Counseling.

Donovan said there has been an 11 percent reduction this year in the number of underwater mortgages.

But, despite that progress, he said there's more work to do, including a bill awaiting a vote in Congress that Donovan said would make it easier for millions of Americans to refinance their mortgages.