US Senate passes housing aid bill

Saturday, July 26, 2008

A Saturday, July 26th, meeting of the United States Senate resulted in the passing of a $300 billion housing aid bill designed to help homeowners facing foreclosure by providing financial aid. In addition, the bill created a government emergency fund for mortgage companies, Fannie Mae and Freddie Mac. The legislation is expected to benefit up to 400,000 homeowners. The Congressional Budget Office said that between now and December 31, 2009, that if any bailout for the companies was needed, they expected it to be less than $25 billion.

The United States Capitol building, where the Senate meets
Image: Ed Brown.

The House on July 23th, passed the bill with a final vote of 272 in favor and 152 against. The final vote in the Senate was 72 in favor and 13 against. President Bush had initial woes about the bill based upon a $3.9 billion part of the legislation allowing for repurchase and improvement of foreclosed homes by the stricken neighborhoods.

The Bush Administration believed that this could be a potential problem, because it created a incentive for mortgage companies to foreclose homes. Bush has since changed his mind on the matter and is expected to sign the bill in the near future.

The bill has been considered one of the most important pieces of housing legislation in years. Senator Christopher Dodd of Connecticut said that "this bill is going to make a difference almost immediately." Despite the bill's overwhelming support, it has had its dissidents. "We are pretending to chain a monster here and we are, instead, letting that monster loose," said Arizona Representative Jeff Flake. Originally a supporter of the bill, Senator Charles Grassley of Iowa has changed his opinion because of the addition of the emergency fund for Fannie Mae and Freddie Mac. "This bill has fallen prey to the special interests on Wall Street and K Street at an unjustifiable expense to taxpayers and homeowners on Main Street," said Grassley.