Modernization Not A Done Deal
December 16th, 2007
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While the Senate passed FHA modernization by an overwhelming majority, 93-1, it did not pass the same bill that was approved by the House.
The distinctions between the two bills are important and it would be unwise to suggest that FHA modernization will sail through a conference committee. As Rep. Barney Frank (D-MA), chairman of the House Financial Services Committee, explains:
“I welcome the Senate’s passage of their FHA legislation. We are in agreement that this is an important action in dealing with our subprime challenges, and that we should act quickly so that the FHA can be a resource for people who can refinance their loans. I look forward to working with the Senate to preserve important elements of the House bill, for example, ensuring that lower income people do not pay higher premiums than other borrowers, especially for refinance loans for subprime borrowers; sufficiently increasing FHA loan limits to make more Americans eligible for FHA loans; and preventing HUD from imposing unnecessary fee hikes. Since part of the response to the subprime crisis is an adequate supply of affordable rental housing for families that lose their home or can’t afford to buy a home, it is critical that the bill we send to the President retain provisions in our legislation authorizing the reinvestment of revenues for affordable housing purposes.
“I congratulate Senator Dodd on getting this important legislation passed, and I look forward to working out the differences in the two bills in negotiations with the Senate.”
Read between the lines — Frank is saying that he will fight to keep significant elements of the House bill in the final measure — elements not accepted by the Senate to this point.
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This entry was posted on Sunday, December 16th, 2007 at 1:34 pm and is filed under . You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.
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January 2nd, 2008 at 12:14 pm
In June 2006 the Republican controlled House passed HR 5121. Barney Franks and Maxine Waters voted for it. That bill was much more conservative to what they want now (HR 1852). I believe in the end Mr. Franks will bend in order to get it done. One element in the House version I hope he wins out on is on the loan limits.
January 3rd, 2008 at 5:24 am
John –
You make a good point.
It is entirely common on Capitol Hill to introduce bills which have little chance of passage without amendment — and to then fight for as little amendment as possible.
Frank did get a veto-proof vote on his bill so in this case he has a strong position to fight dilution. Whether he will succeed is an open question.
February 11th, 2008 at 8:35 am
Part of the bill passed by the house was to eliminate the requirement of an audited financial for a broker to become approved to originate FHA loans. As I understand it their bill would change this requirement to have a bond.
Is there any word as to when or if the senate will take action on this
April 5th, 2008 at 5:37 am
What seems to be the holdup preventing passage of the modernization bill. We have completed the required counseling to qualify for a HECM mortgage and await the increase in the loan cap to $417,000 so we can close the deal without an up front cash outlay. Who do we have to contact to convince them of the critical importance of bringing this bill forward for final approval? We are retired seniors looking at the lose of our home unless this legislation gets signed into law. Please help!!!