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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: John Pitera who wrote (9438)	5/19/2008 6:37:41 PM
From: John Pitera	Respond to of 33421

Dodd, Shelby Reach Agreement on Anti-Foreclosure Bill (Update1) By Alison Vekshin May 19 (Bloomberg) -- The leaders of the U.S. Senate Banking Committee announced agreement on housing legislation that creates a voluntary program to stem foreclosures, ending a standoff over whether taxpayer funds should be used. Senators Christopher Dodd, the panel's chairman, and Richard Shelby, its top Republican, agreed to pay for the program through an affordable housing fund financed by Fannie Mae and Freddie Mac, Dodd said today in a conference call with reporters. The legislation would also establish a new regulator to oversee the two government-sponsored companies, according to a statement from the banking committee. ``This legislation is good news for both the markets and homeowners,'' Dodd said. If approved by the full Senate, the package would be combined with a bill passed two weeks ago by the U.S. House of Representatives over a White House veto threat. Shelby has said he thinks President George W. Bush will support the Senate measure. The Senate banking panel is scheduled to debate and vote on the legislation tomorrow. Dodd and Shelby tentatively agreed last week on a proposal that would *allow borrowers at risk of foreclosure to refinance their homes with government-backed mortgages through the Federal Housing Administration,* with financial support from Fannie Mae and Freddie Mac. The FHA program, which would insure up to $300 billion in loans, was estimated to cost taxpayers $1.7 billion over the next five years, according to congressional analysts. Those costs could run higher if foreclosures exceed forecasts. Lawmakers were debating last week whether Washington-based Fannie Mae and McLean, Virginia-based Freddie Mac, the biggest sources of money for U.S. mortgages, should cover the whole tab or have their payments capped at the program's projected cost of $1.7 billion, Shelby spokesman Jonathan Graffeo said on May 15. To contact the reporter on this story: Alison Vekshin in Washington at avekshin@bloomberg.net.