Senior US senators published a bipartisan set of proposals Wednesday they hope to quickly bring into law to help alleviate the effect of the mortgage crisis on ordinary Americans.
“This is a solid, bipartisan start to keeping families facing foreclosure in their homes, helping other families avoid foreclosures in the future and helping communities already harmed by foreclosures to recover,” they said in a joint statement.
Democratic Senate majority leader Harry Reid and Senate Republican leader Mitch McConnell, members of the banking and housing committee, hammered out the plan in two days, after a first Democratic plan failed.
Four billion dollars has also been earmarked to help communities affected by foreclosures, by enabling the purchase and development of empty houses that otherwise could lead to falling house prices and rising crime in the area.
The proposals include a new tax credit for homeowners, demands for greater transparency in mortgage contracts, specific protection for military families facing foreclosure, counselling to help families avoid losing their homes, and a tax credit for buyers of homes in foreclosure.
“The package that we agreed to is not perfect, nor will it solve all of the problems that the economy and American homeowners are facing today,” said Democratic senator Chris Dodd, chairman of the banking committee.
Reid and McConnell said in outlining the plans that they hoped the bill would quickly move to the Senate for debate. It must then be considered by the US House of Representatives before going to the president.
It is the second time since the beginning of the year that Congress has intervened to try to cut short the mortgage crisis linked to troubles in the subprime sector, where loans are made to people with poor credit.
“But it is an important step, and sends a strong message to the American people that Congress is willing to put aside our partisan differences and come together to tackle the challenges at hand.”
In February, President George W. Bush approved an economic stimulus package which will see the Treasury mail checks to millions of Americans next month.
Tags: foreclosures, homeowners, law, mortgage, senators
