President Bush signed the big housing bill today. He didn’t love it and put his signature on it privately rather than in a big press event in the Rose Garden. There isn’t even a mention of the bill, the largest housing initiative since the Great Depresssion, on the White House’s official Web site.
There’s something in here for just about everyone, which is why the President didn’t like it. Here are some details you may have missed in all the coverage, courtesy of the California Association of Realtors:
The law will help an estimated 400,000 homeowners facing foreclosure by allowing them to refinance their current mortgages with a Federal Housing Administration (FHA)-backed loan.
The bill lifts Fannie Mae and Freddie Mac loan limits to the greater of either $417,000 or 115% of an area’s median home price, up to $625,500. That’s a big help to homeowners in high cost markets.
There’s a first-time home buyer tax credit, which gives first-time buyers a tax refund worth up to 10% of a home’s purchase price, up to a maximum of $7,500. The refund is actually an interest-free loan and the homeowner is required to repay it in equal installments over 15 years.
There are now minimum requirements for mortgage brokers including fingerprinting of loan originators and a nationwide licensing and registration system.
The legislation cracked down on “nonprofits” that were allowing buyers to qualify for FHA loans with no money down by transferring funds from the home seller to the buyer to use as a down payment. Buyers can still accept down payment assistance from family, employers and other nonprofits.
The Community Development Block Grant Programs provides $4 billion for communities to purchase and refurbish foreclosed homes.
BusinessWeek editors Chris Palmeri, Prashant Gopal and Peter Coy chronicle the highs and lows of the housing and mortgage markets on their Hot Property blog. In print and online, the Hot Property team first wrote about the potential downside of lenders pushing riskier, "option ARM" mortgages and the rise in mortgage fraud back in 2005—well ahead of many other media outlets. In 2008, Hot Property bloggers finished #1 in a ranking of the world's top 100 "most powerful property people" by the British real estate website Global edge. Hot Property was named among the 25 most influential real estate blogs of 2007 by Inman News.