WASHINGTON (7/24/08)—A broad housing bill intended to address the county’s current mortgage foreclosure problems was passed by the House 272-152 Wednesday. At the heart of the bill is a provision drafted to help borrowers holding $300 billion of troubled mortgages avoid foreclosure by allowing the Federal Housing Administration to insure the loans after reductions in principal. The bill also, among other things, includes public-confidence builders for Fannie Mae and Freddie Mac, proposed by U.S. Treasury Secretary Henry Paulson. For instance, the bill (H.R. 3221) increases the government-sponsored enterprises’ (GSEs’) line of credit. It also gives Treasury authority to purchase the GSEs’ equity. Both measures are effective for just 18 months. The bill also establishes a new regulator for Fannie and Freddie. The bills also creates a Fannie- and Freddie-supported affordable housing fund, as well as authorizes additional funding for community development block grants and expands opportunities for housing counseling for consumers. Another provision sets the conforming loan limits for Freddie and Fannie at the lower of $625,500 or 115% of an area’s median house cost. The new limit would go into effect when a current temporary increase expires at the end of the year. The Senate is expected to quickly follow the House with an affirmative vote on the package—which represents a laboriously sought-after compromise between the House and Senate. As if acknowledging the ping-pong nature of recent negotiations, the House clerk, on the voting calendar, described the House considerations Wednesday this way:
* H. Res. 1363: providing for consideration of the Senate amendment to the House amendments to the Senate amendment to the bill ( H.R. 3221) to provide needed housing reform and for other purposes.