Democrats' Housing Plan Faces Bush Veto

(AP)  Strapped homeowners could refinance into government-backed mortgages and states would get money to deal with foreclosed property under Democrats' housing aid plan.

The measures, slated for votes Thursday, constitute the most significant action Congress has taken to date to address the housing crisis that's at the center of the nation's economic woes.

President Bush has threatened to veto both measures, which he says reward lenders and speculators. Democrats counter that the bills will head off hundreds of thousands of foreclosures, stabilize the shaky housing market, and prevent neighborhood blight.

The centerpiece of their plan is a bill by Rep. Barney Frank, D-Mass., the House Financial Services Committee chairman, to have the Federal Housing Administration relax its standards and back up to $300 billion in more affordable, fixed-rate loans for borrowers currently too financially strapped to qualify.

Those homeowners could refinance into new loans if their lenders agreed to take substantial losses on the original mortgages. Borrowers would have to show they could afford to make payments on the new loans. They would have to share with FHA at least half of their proceeds if they profited from selling or refinancing again.

The plan is projected to help roughly 500,000 borrowers at a cost of $2.7 billion over the next five years.

A separate bill by Rep. Maxine Waters, D-Calif., would send $15 billion in loans and grants to states for the purchase and rehabilitation of foreclosed properties. Proponents say it will prevent blight in neighborhoods plagued by abandoned, foreclosed homes.

But Republican critics argue it rewards lenders and investors who own the property, and could act as an incentive for them to foreclose rather than find ways to help struggling borrowers stay in their homes.

Democrats, seeking Republican support for their housing package, were planning to attach a grab-bag of measures Mr. Bush has called for.

Those include legislation to overhaul the FHA, to more tightly regulate government-sponsored mortgage giants Fannie Mae and Freddie Mac, and authority for state and local housing finance agencies to use tax-exempt bonds to refinance distressed subprime mortgages.

The plan is also to include a housing tax credit of up to $7,500 for first-time home-buyers, to be paid back over 15 years. It would permanently raise the limit on the size of loans FHA could insure and Fannie Mae and Freddie Mac could buy to $729,750 in the highest-cost housing markets. Those caps are scheduled to fall at the end of the year, to $362,790 for the FHA, and to $417,000 for Fannie Mae and Freddie Mac.

[forthepeopl1]

ALL THEY HAVE TO DO IS MAKE ALL MORTGAGES FROM 2000 TO 2007 ALL GET RE-FI AT A GOOD RATE LIKE 1 OR 2 POINTS OVER PRIME, THATS ALL AND IT WOULD STOP EVERYTHING ONCE AND FOR ALL.

TAKE WHAT THE MORTGAGE IS NOW MINUS 60 % PERCENT OFF AND RE-FI EVERYONE..THIS WOULD STOP IT ALL, AND STOP PUTTING GOOD AMERICANS ON THE STREET.

I JUST HAD MY REALTOR APPRAISE MY HOME I BOUGHT 6 YEARS AGO, PAYED 300,000 FOR IT NOTHING SPECIAL IN A SMALL TOWN IN MASS, NOW HE SAID ITS WORTH MAYBE 150,000 BUT REALLY THINKS IT WORTH 100,000..SO GUESS WHAT WHAT THE BANK WILL OWN IT FOR 300,000 BECAUSE THEY DONT WANT TO HELP IN MAKEING THE VALUE THE 100,000 TO 150,000, AND EVEN AT THAT RATE HE SAID IS BETTER THAN WHAT THEY ARE GETTING AT FORCLOSER SALES, THEY ARE GETTING 20 TO 30 CENTS ON THE DOLLAR. SO IT WOULD MAKE SENCE TO JUST RE-FI EVERYONE AT 40 PERCENT AND START OVER. THIS WOULD STOP EVERYTHING...

[e-mail]

THIS IS ONLY WAY TO STOP ALL FORCLOSER

[forthepeopl1]

President Bush has threatened to veto both measures, which he says reward lenders and speculators. Democrats counter that the bills will head off hundreds of thousands of foreclosures, stabilize the shaky housing market, and prevent neighborhood blight.

SO TELL ME MR BUSHBAG, WHY DID YOU BAILOUT BEARSTEARNS, SOUNDS LIKE IT IF IT ISN''T YOUR WAY IT NO WAY..

PLEASE PAULSON AKK ( MR. POTATOHEAD ) TELL US WHY YOU SPEAK AND BUSH SPEAKS WITH FORK TONGE????!!!!!

[forthepeopl1]

THIS IS WHY AMERICANS HAVE TO VOTE IN ALL NEW REPS/SEN/ ONLY NEW BLOOD WILL DO THE TRICK,AND ONLY ONES THAT WILL PLEGE THAT THEY WILL SIGN A NEW LAWS THAT STATES NO ONE IN CONGRESS CAN TALK TO ANY AND ALL CORPS HEADS AND ASSOCITAE.........

ONLY WORK FOR THE PEOPLE OF AMERICA.

TELL CHINA TO F-OFF, AND MEXICO TO F-OFF, AND EVEN CANADA THAT IS UP BUSH/RICE A/S/S..

AMERICANS BETTER WAKE UP FAST............

[forthepeopl1]

WELL, IF AMERICA WANTS TO GET CONGRESS TO DO ANYTHING FOR THEM THERE IS ONLY ONE WAY TO DO IT..

ALL AMERICANS GO ON STIKE PERIOD, THIS WOULD STOP THEM IN THEIR TRACKS..WITH NO MONEY COMMING IN THE GOVERNEMNT THEY WOULD HAVE TO START LISTEN TO US AMERICANS..

BUT EVERYONE WOULD HAVE TO DO IT..NO TRUCK MOVEING,TRAINS,BUSES TAXI,CARS, JUST EVERYONE STAYING HOME FOR A WEEK OR TWO........THINK ABOUT IT AMERICA, THEY WOULD S/H/I/T/ IN THEIR PANTS.......

[truthyness]

EVERYTHING ABOUT OBAMA IS RACIST AND THEN HE HAS

THE ARROGANCE TO ACCUSE HER OF BRINGING UP RACE.

SHAME ON YOU OBAMA!!!!

[my2centss]

$300 billion here with $9 trillion debt. How does our government expect the people to manage money, if they have no concept of it either? Who will bail out the US?

[payasyougo]

Bush just needs to sign this so we can move forward and start the legislation on refinancing credit card debt.

[dowjones20k]

So does this mean Republicans will hold Bush personally responsible for his crimes while in office?

Posted by simonsez40 at 03:43 PM : May 08, 2008

You can bet if any Democrat had the goods to brings criminal charges against Bush they would have done it by now .. you dont hear pelosi, kennedy, kerry or any other dem screaming about this .. so you can bet they all have dirty laundry and will just sweep it under the rug .. thats if you beleive there are any crimes in the first place ...

BOTH parties are corrupt and could care less about you or me or our families .. it would be great if we did hold these fat crooks responsible and get them out of officew as soon as possible ..

[elsewhat]

I think the 2 party system sucks, and if we would all would understand that while we are all fighting about who is right and wrong the rich are selling us out to China and Mexico. The working class that use to support their business can no longer afford to even put the gas in their car to go to the job that they are shipping out of this country. SO LET ME ASK THIS AS LOUD AS I CAN, ARE WE BEING SET UP FOR A LIFE OF DEBT TO THOSE CARREER POLITICIANS THAT DON''T KNOW WHAT IS LIKE TO LIVE HAND TO MOUTH BECAUSE THEY SOLD US OUT? Please don''t base your vote on the 2 party system, base it on what is best for America and the people.

[simonsez40]

Whatever PARTY you are aligned with - we should hold each office in the White House responsible and when they fail or break the law - kick them out, put them in prison or end their assignments.

If politicians did what they do in the business world they''d be in prison. I''m for change - and whether Republican or Democrat we need to get involved and hold our representatives accountable for their actions.