Some of the key provisions of the legislation include the following:

$300 billions in loans to help distressed homeowners refinance their mortgages through a new FHA backed program. The program is expected to help some 400,000 Americans to keep their homes.

A tax break of up to $7,500 for first time home buyers. Eligible individuals are those who purchase between April 9, 2008 and July 1, 2009 and who haven’t owned a home in the past three years.

New lines of credit for Fannie Mae and Freddie Mac and a new regulator – the Federal Housing Finance Agency to provide additional oversight of these mortgage lenders.

$3.9 billion in community development grants to buy and repair abandoned and foreclosed properties.

Sources: http://www.reuters.com/article/topNews/idUSN3042756820080731,

http://ap.google.com/article/ALeqM5hs5zArRJP0FhzvfKNXi60I95LyqQD928CD780,

http://www.house.gov/apps/list/press/financialsvcs_dem/press0723082.shtml 

The Housing and Economic Recovery Act of 2008 passed by a vote of 72-13. The House approved the measure on July 23rd. The Bill has been sent to President Bush who is expected to sign it.

Some of the key provisions of the bill include the following:

* $300 billion in loans to help distressed homeowners refinance their mortgages into more affordable 30 year fixed loans backed by the government. The measure is expected to help some 400,000 thousand Americans to keep their homes. Of note, in return for refinancing a loan, borrowers agree to give the Federal Housing Administration a share in the profits of the home’s future appreciation.

*A tax break of up to $7,500 for first-time homebuyers. Eligible first time buyers are those who purchase between April 9, 2008 and July 1, 2009 and who haven’t owned a home in three years.

*Authorizes the United States Department of The Treasury to provide increased credit to Fannie Mae and Freddie Mac and creates a new regulator, the Federal Housing Finance Agency, to provide additional oversight of these mortgage lenders.

*Provides $4 billion in grants to states and local communities to buy abandoned and foreclosured properties.

*Establishes an Office of Housing Counseling to provide counseling and educational material for people applying for mortgages.

Sources:

http://www.house.gov/apps/list/press/financialsvcs_dem/press0723082.shtml,

http://biz.yahoo.com/brn/080728/26169.html?.v=1,

http://www.npr.org/templates/story/story.php?storyId=92826335

Among other things, the bill seeks to provide more relief for borrowers facing foreclosure and it would modernize Federal Housing Administration (FHA) loan guidelines. It would also provide new regulatory oversight of Fannie Mae and Freddie Mac, government backed mortgage finance companies.

One of the bill’s key provisions would allocate $300 billion to refinance mortgages of certain borrowers which would otherwise be headed toward foreclosure.

The House is expected to take up the measure this week.

Source: http://online.wsj.com/article/SB121578592157145943.html?mod=googlenews_wsj