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June 23, 2008 - In May, both House and Senate financial and banking committees passed bills to address the housing crisis. Leaders in both the House and the Senate expressed their intentions to have final legislation on the President’s desk for approval by the July 4 holiday.
It is a priority for Christopher Dodd (D-Conn.), Senate Banking Committee Chairman, to secure time on the Senate floor to further debate the legislation. The goal is to modify the Senate bill to more closely resemble the bill passed in the House, the Housing Rescue and Foreclosure Prevention Act of 2008. Changes to the bill are being debated on the Senate floor. It is not expected that there will be a vote on the legislation in the full Senate until June 24.
There are critical differences between the legislation in the House and the Senate. The Senate bill was designed to stabilize housing prices; it included a section for government sponsored enterprise (GSE) reform and an amendment offered by Senator Dianne Feinstein (D, Calif.) to set minimum licensing and registration requirements for mortgage originators.
The House bill includes a permanent increase in the conforming loan limit to $729,500, while the Senate bill caps it at $550,000. The Senate bill requires securitization of jumbo loans by Fannie and Freddie and the House bill allows them to hold the loans in their portfolios. The Housing bill allows funding to rebuild the Gulf Coast after Hurricanes Rita and Katrina. It also includes an amendment offered by Rep. Mel Martinez (R, Fla.) to set minimum licensing and registration for mortgage originators.
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