WASHINGTON, D.C. - The President signed into law The Housing and Economic Recovery Act of 2008, which authorizes the Department of the Treasury to purchase obligations of housing Government Sponsored Enterprises (GSEs); reforms the regulatory supervision of the housing GSEs; provides reform of the Federal Housing Administration; provides homeownership assistance and reforms to mitigate recent increases in foreclosures; and contains housing-related tax incentives and other tax provisions.
Senator Chris Dodd (D-CT), Chairman of the Senate Committee on Banking, Housing and Urban Affairs, who authored the legislation along with Senator Richard Shelby (R-AL) issued the following statement, "Today marks an important change in the federal government's response to the economic strain being felt by millions of Americans across the country and our financial markets. This is the most sweeping housing legislation since the Great Depression, representing a turning point in our country's commitment to economic growth and affordable housing, and providing relief to homeowners and communities across the country. I congratulate the President for signing it, and I am committed to ensuring that this law is implemented effectively and expeditiously, and that it fulfills its promise to prevent foreclosures, restore home values, stabilize our housing markets, and create economic growth."
Key provisions of the law include:
The HOPE for Homeowners Act: Creates an initiative within the Federal Housing Administration (FHA) to prevent foreclosures for hundreds of thousands of families at no estimated cost to American taxpayers.
Assistance for Communities Devastated by Foreclosures: To ensure that communities can mitigate the harmful effects of foreclosures, $3.92 billion in supplemental Community Development Block Grant Funds will be provided to communities hardest hit by foreclosures and delinquencies.
Foreclosure Counseling for Families in Need: To help families avoid foreclosure, the bill provides $180 million in additional funding for housing counseling and legal services for distressed borrowers.
GSE Reform: Creates a world class regulator for the government-sponsored enterprises (GSEs) so that these vital institutions can safely and soundly carry out their important mission of providing our nation's families with affordable housing.
Treasury Emergency Authority: To shore up confidence of the financial markets in Fannie Mae, Freddie Mac and the Federal Home Loan Banks, the legislation contains several temporary provisions requested by the Treasury Secretary including authority for Treasury to purchase common stock and debt securities issued by the GSEs.
Preserving the American Dream for Our Nation's Veterans: This bill contains several provisions to help returning soldiers avoid foreclosure, including lengthening the time a lender must wait before starting foreclosure from three months to nine months after a soldier returns from service.
FHA Modernization: Reforms to modernize, streamline and expand the reach of the FHA, allowing families in all areas of the country to access secure and affordable mortgages through FHA.
Affordable Housing Fund: A new, permanent fund that will help create more affordable housing for Americans in communities across the country.
Enhancing Mortgage Disclosure: To ensure that consumers know the exact amounts of their mortgage payments, including the maximum possible payment under the terms of the loan and changes in payments associated with adjustable rate mortgages, lenders will be required to provide borrowers with more timely and meaningful mortgage disclosures on all home purchase loans, loans that refinance a home, and loans that provide a home equity line of credit.
Standard Property Tax Deduction: To make tax relief available to all Americ
Source: OriginatorTimes.com