On July 26th, in a rare weekend session, the Senate approve a bill that has many trumpeting as the most consequential housing legislation in decades. With bi-partisan support, 72-13, the bill is aimed at assisting homeowners struggling to make their ballooning mortgage payments refinance into more affordable loans, avoid foreclosure and ultimately keep their homes.
Some estimates indicate that there are approximately 2 million people going through some stage of the foreclosure process. This bill now provides them the opportunity to restructure their loan payments, avoid foreclosure and stay in their homes.
After originally calling the bill an expensive bail-out for irresponsible borrowers and lenders, President Bush has indicated that he will sign the bill later this week. About 400,000 families could see some relief as early as this fall.
The portion of the bill that permits homeowners to refinance into more favorable loans will only be available for a few years.
Also included in this bill, about 4 billion in grants for purchasing and renovating foreclosed properties in hard hit areas, funding for new housing counselors and a tax refund for first time home-buyers.
Summary of The Housing and Economic Recovery Act of 2008
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