On Friday the Senate passed new legislation that would make more Federal Housing Administration Loans available to troubled borrowers facing foreclosure, lowering the down payment required and allowing larger loans. The House passed similar legislation in September, and now House and Senate members will have to “resolve a number of differences between the two pieces of legislation,” says the Wall Street Journal.
“The agency’s loan terms, which are more stringent than those of many lenders, may have caused some borrowers to turn to subprime mortgages. Housing officials estimate that the legislation will help about 200,000 homeowners who have fallen behind on their mortgage payments.”
The housing industry, including home builders and real estate agents, pushed for the legislation because they will benefit from the expansion of F.H.A. loans, says Bloomberg.
“This legislation is the perfect example of the kind of help Americans are looking for,” Senator Charles E. Schumer, a New York Democrat who was a sponsor of the bill, said on the Senate floor. “It is definitely and desperately needed.”