Foreclosure Help For Many Americans

[Jun 3, 2008.]

It is no secret that the housing market is facing its worst down turn it has seen in several years, possibly a decade. In an effort to ease home owner’s financial obligations and with hopes to stimulate the market several government officials have proposed acts and provisions aimed at giving the housing market a jolt in the arm.

Foreclosures are on the rise with more on the way; and experts predict that in the coming month’s 1.5 million homeowners with sub prime adjustable rate mortgages will reset with higher interest rates. When this happens those homeowners will be hard pressed to meet those monthly payments on time and thus creating a risk of foreclosure.

The Senate and the House have created different packages with the goal of stabilizing the housing market, but with bipartisan politics at play the likelihood of either package passing any time soon is small. The Senate is ready to pass their $15 billion package which will give many homebuilders a tax break and create a new tax credit for homeowners and home buyers.

While the package that the House may propose is yet unknown many experts believe that the proposal set forth by Barney Frank, D-Mass who is the Chairman of Financial Services will play an important role.

Chairman Frank would like to allow the Federal Housing Administration commonly referred to as the FHA to insure troubled loans, and doing so will likely cost up to $300 billion dollars. For the House’s proposal, it is speculated there will be a tax break, which would primarily benefit home builders who saw gains during the housing boom but are now facing significant losses.

Both the House and the Senate are concerned with stimulating growth in the economy to save the housing market, and those who are in financial trouble. In a joint statement released Monday by House Speaker Nancy Pelosi, D-Calif and Rep. Charles Rangel, D-N.Y. both stated their desire to see teamwork in such difficult times stating that “We must work together to restore consumer, market, and worker confidence.”