Hello, All!
The long-awaiting Housing Reform Legislation seems likely to pass the U.S. Senate next week. The effect on markets faced with high housing inventory and slack demand, along with tight loan underwriting standards - including parts of Chicago and the suburbs - could be significant!
It's proposals are ambitious - relaxed loan guidelines for FHA, Fannie Mae, and Freddie Mac that could allow perhaps as much of $300 Billion of new, fixed-rate loans that could help homeowners facing sizable rate resets in the coming couple of years.
Also, an increased Conforming Loan Limit of $625,000 - perhaps higher - is a key component of the bill, as well as a proposed first-time home buyer tax credit of up to $8,000, plus incentives to those that purchase and rehab foreclosed properties.
According to Senator Christopher J. Dodd (D - Connecticut), "Unless we act and do so promptly, we're going to look at a situation that only gets worse."
However, the bill faces considerable opposition before it is passed!
The U.S. House, and the Bush Administration, are divided over several key elements of the bill - including acceptable loan limits, foreclosure incentives, and time for implementation - quickly, or over time.
President Bush and those in his administration feel the foreclosed properties incentives comprise a "bailout" of lenders - many of whom, the Bush Administration feels, contributed to today's credit and mortgage problems.
Seller-funded Down Payment Assistance Programs continue to draw the ire of the administration, while the Congressional Black Caucus supports these programs that they feel will stave off blight in many stressed communities. Many African-American home buyers, say caucus members, rely on these assistance programs in order to buy a home.
Indeed, the Housing Reform Legislation is a step in the right direction, in today's real estate market - but it's got a bit of a rocky road ahead before it becomes law, it seems.
See our post today at BlogChicagoHomes.com for more info, as well as a link to today's Associated Press article in The Wall Street Journal.
DEAN & DEAN'S TEAM CHICAGO
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