The efforts to resurrect the Hope For Homeowners program are in full swing now. The House already passed a bill designed to loosen requirements for the program and increase incentives for lenders to participate. The Senate just passed a similar bill today. The next step is for the two bodies to draft a melded final bill and push toward final votes. Here are some excerpt from a recent AP story on the subject:
Trying to curb home foreclosures, the Senate voted on Wednesday to make it easier for homeowners with risky credit to switch to a lower-cost mortgage backed by the government.
The bill, passed 91-5, also would give banks a break by encouraging reduced fees they must pay for the government to insure deposits.
While both steps put taxpayer money on the line, lawmakers say the legislation is needed to prevent the economy from getting worse.
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The Senate housing bill would expand an existing $300 billion program called “Hope for Homeowners,” which encourages lenders to write down an individual’s mortgage if the homeowner agrees to pay an insurance premium. The program, which is set to expire in 2011, is intended to swap out a homeowner’s high-interest rate for a 30-year fixed loan backed by the Federal Housing Administration.
So far, the program has been a dud.
When it was established last year, Congress envisioned helping some 400,000 troubled homeowners. But because eligibility requirements were so strict, one borrower has completed the refinancing process