The chance of an election year solution package is growing dimmer as Bush and Congress cannot seem to agree about how to rescue the housing market. Bush, threatening to veto the Barney Frank bill because it would help undeserving people, he may just sit on the whole mess until he leaves the presidency. “We are committed to a good housing bill that will help folks stay in their house, as opposed to a housing bill that will reward speculators and lenders,” Bush said at the White House after meeting with House Republican leaders.

(more…)

A bill that would give authorization to the FHA guaranteeing up to $300 billion in new mortgages from government-approved lenders was approved 42 to 21 on Thursday. The House will consider the measure next week. The program is meant to help over 1.5 million homeowners facing foreclosure. Representative Barney Frank related that the borrowers facing foreclosure due to the housing market and credit crises deserve the help, even though many of them signed for loans that they couldn’t afford. “There are people who made loans that should not have been made; there are some people that were wrong to take the loans out, some wrong to make the loans. If nothing happens and all those loans go under foreclosure, the economy suffers,” he said.

(more…)

Senator John Kerry introduced the Military Family Homes Protection Act structured to expand the Service Member Civil Relief Act (SCRA) that would provide US soldiers relief for one year from any increase in their mortgage rates. Instead of 90 days to do something about a foreclosure, the bill extends the time to nine months after active duty soldiers return home. The Mortgage Revenue Bond program will be provided an extra $10 billion dollars of tax-exempt bonds that will be used to refinance subprime loans, mortgages for first time borrowers, and multifamily rentals.

(more…)

The Senate has responded to the housing crisis, but missed the mark big time. The American economy has lurched into recession thanks, in part, to the mortgage market and over 600,000 foreclosures. Some fault the borrowers for getting in over their heads in debt, but the truth is that lenders wooed the vulnerability of people wanting to buy a home. They were offered subprime packages they couldn’t afford along with boutique mortgages with nice short-run terms that led to this very long run hurricane. Lenders counted on making a few billion but didn’t count on the bottom falling out. Nor did they prepare for the possibility.

(more…)

A bipartisan package of tax breaks and other means to help homeowners cope with the housing crisis was passed today by the Senate. Although the measure passed with an 84-12 vote, its supporters agree the bill leans too much in favor of homebuilders and does way too little to help borrowers at risk of foreclosure.

The bill incorporates a $7,000 tax credit for those who buy foreclosed properties, and $4 billion in grants for communities to buy and fix abandoned homes. However, the measure will be considerably redrawn by House critics who claim it does not help people in foreclosure enough.

(more…)

At the end of March 2008, the United States Senate agreed that a bill must be passed to help the country homeowners in crisis. But hope for any compelling type of aid to the U.S. economy dimmed as Congress and the White House took yet a third, more dwindling approach.

While the Senate, the upper part of Congress, was developing a $15 billion bill that included $6 billion in tax write offs for banks and homebuilders, the House of Representatives introduced an $11 billion deal more to aid homeowners who struggle with mortgage debt.

The two plans would have to be consolidated – an overwhelming job because of the huge gap between them – before President Bush would give his approval. The federal housing administration announced today its plans for a small-scale program that will encourage banks to take on more losses in mortgages for a swap of rewritten loans that cash depleted homeowners could manage.

(more…)

Representative Barney Frank had an idea. It was called H.R. 3915. For those home mortgages originated at the beginning of 2005 and mid 2007, lenders, and borrowers would agree on a federal refinancing plan. This plan would require lenders to write down their loan to no more than 85% of the current appraised value of the property.

Borrowers get an extra deal: the principle is reduced to market value and they get a low fixed monthly house payment. FHA would guarantee these loans up to $300 billion in Frank Refinancings. Mr. Frank is concerned that reliable borrowers may default on purpose just to get a piece of H.R. 3915. His answer to this dilemma was to make borrowers “certify” that they truly, are not going to do such a thing just to board the taxpayers’ gravy train. Right.

(more…)

A new package of mortgage legislation was voted on today by the Senate after debate in Congress for new urgency to aide millions of mortgage holders at risk for foreclosure. The vote was an overwhelming 94-1 to move ahead with the package of housing legislation. The legislation includes more mortgage counseling, money to local governments to buy properties in foreclosure, and a provision to allow bankruptcy judges to alter the terms of mortgage loans on primary residences only. The purpose is to stem the tide of increasing foreclosure rates and hopefully it is a beginning to turning around the economy.

By noon Wednesday, April 2nd, the two ranking Senators of the Senate Banking Committee, Christopher J. Dodd, and Richard Shelby, will “consult and report back by noon with the core of legislation to which amendments can be offered.”

(more…)