Dodd And Shelby Make A Deal

Sen. Chris Dodd (D-Conn.) and Richard Shelby (R-Ala.) have hashed out a compromise on housing legislation.

The Senate Banking, Housing and Urbain Affairs Committee - which Dodd chairs -- will consider the legislation Tuesday, the continuation of one from last week at which nothing happened because the lawmakers will still working out the deal.

A release announcing the compromise didn't offer any specifics on the new legislation but it sounds like Shelby won his battle to eliminate the $1.7 billion taxpayer subsidy in the original bill for a foreclosure-prevension program. The voluntary measure is still there but now its "at no estimated cost to taxpayers."

It's unclear how that was accomplished, however.

The legislation aims to avoid some foreclosures by allowing the Federal Housing Administration to offer new mortgage guarantees in cases where the lender agrees to write down a portion of the outstanding loan.

Dodd's bill would also create a new, independent regulator for the so-called government-sponsored entities Fannie Mae, Freddie Mac and the Federal Home Loan Banks.

A copy of the full release is after the jump.
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