Las Vegas real estate, mortgage, appraisal blog

The Senate approved its Housing Relief Bill yesterday with a rather stunning 84 to 12 victory. Despite White House opposition it was an overwhelming show of consensus from both parties. The bill is supposed to help as many as 1.5 million homeowners by having the FHA (Federal Housing Administration) insure up to $300 billion in refinanced mortgages, according to an article in The New York Times.

The Senate majority leader, Harry Reid of Nevada, called the vote “just the beginning of a process” that he said “will continue in the House of Representatives.” He added, “I hope that when the process is complete, we will have a strengthened bipartisan bill that will do even more to help families, communities and our economy.”

The Bush administration is also working on its own plan to help replace adjustable rate mortgages with more affordable loans. These loans would, of course, be issued by the government. Officials for the deal claim that the plan could help as many as 100,000 homeowners.

The Presidential candidates are weighing in as well. John McCain announced his own plan on Thursday while speaking in Brooklyn. He says his plan would help up to 400,000 homeowners refinance with more stable terms by using government-backed loans. Both Hillary Clinton and Barack Obama issued statements claiming the Senate bill didn't go far enough.

Homeowners shouldn't start waiting for the bailouts to begin, however.

In the House, Mr. Frank has said his plan would help as many as 1.5 million homeowners. The Bush administration disputes that figure, and says that aiding that many borrowers would require loosening underwriting standards to a point where taxpayers would be at serious risk of having to cover the cost of what could be a large number of defaulted loans.

Some of the numbers given for the Bush administration’s plan are also being questioned. Officials say that a loan refinancing program, created by the president in August, called FHA Secure, has helped 140,000 owners refinance so far, and is on track to help 400,000 by year-end. With the new plan to loosen eligibility rules, another 100,000 will refinance, they say.

But some Democrats and advocacy groups say those numbers are exaggerated and only a small fraction of those being helped by the Bush administration were really in danger of foreclosure.

The Senate bill, although unlikely to be enacted in its current form, would cost about $15 billion over 10 years.