With an 81 to 16 vote, the Senate passed an amended version of H.R. 5140, a $150 billion plan to jumpstart the economy with temporary tax breaks for consumers and businesses, extended benefits, and most importantly, two provisions designed to assist the housing market. According to CNN, the House is expected to consider and pass the amended bill quickly, which could put the bill on the President's desk as early as Monday.
The bill temporarily increased the size of loans that may be purchased by Fannie Mae and Freddie Mac, raising the current level of $417,000 to reportedly up to $730,000 in the highest cost regions of the housing markets. This Bill would also provide increases to the FHA limits which would definitely help the purchase market. We are not sure if that maximum limit will be available in the Washington DC Metro area or not at this point.
Passage of this bill probably be seen as "good news" for the economy by the bond market which would cause a rise in mortgage rates, at lease initially, very similar to the effects of the Fed dropping the Fed Funds Rate.
BY: Scott J. Kinne
First Heritage Mortgage, LLC
703-293-6146 http://www.scottkinne.com/
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