Previously we looked at how the housing bill changes the operation of Fannie Mae and Freddie Mac and the FHA, as well as how the bill changes federal tax policy. Today is our final leg on our tour of the Housing and Economic Recovery Act of 2008.
Here is a summary of miscellaneous components of the Housing and Economic Recovery Act of 2008:
- Establishes a nationwide loan originator licensing and registration system that sets minimum standards for all residential mortgage brokers and lenders as well as strengthens mortgage disclosure requirements (source: Senator Boxer’s website)
- Gives mortgage holders who modify loans held by borrowers who are in default or about to go into default protection from investor lawsuits (source: AP and Orange County Register)
- Provides some severely distressed communities $3.9 billion in Community Development Block Grants that can be used for buying and renovating foreclosed property (source: AP and Senator Boxer’s website)
- Provides distressed borrows $180 million that can be used for foreclosure counseling and legal fees (source: AP)
- Increases the federal debt limit (Dr. Housing Bubble says that the debt limit will increase from $9.815 trillion to $10.6 trillion. He believes that this is where losses at Fannie Mae and Freddie Mac will end up. However, there are a lot of contradictory opinions out there. And sorting all that out is a post, or posts, for another time.).
- Eliminates down payment assistance programs (source: Dr. Housing Bubble) Clarification: Seller-financed down payment is not allowed; however, family-member and non-profit down payment assistance is still allowed. (Source: HUD Secretary Steven Preston on Patt Morrison) SW 8-14-08. The story continues: Even though some worked to keep the down payment assistance program mentioned by HUD Secretary Preston from ending, this program ended on October 1, 2008. However, some are attempting to revive the down payment assistance program. So stay tuned to see how this story plays out. (Source: Marketplace) SW 10-9-08