Homebuyer Tax Credit

Daily Real Estate News May 21, 2009 HUD: Homebuyer Tax Credit Loans Still on Track News reports that the federal government is backing away from its plan to permit eligible borrowers to monetize the first-time homebuyer tax credit are off the mark, a spokesperson for the U.S. Department of Housing and Urban Development says.
"The technical details are still being finalized and will soon be published in a mortgagee letter and posted on our Web site," Lemar Wooley, a HUD spokesperson, told REALTOR® Magazine Wednesday afternoon.
Under the guidance that's under development, state agencies and other HUD-approved entities would be able to provide short-term bridge loans that households could use to help with their downpayment. The loans would be repaid with the proceeds from the households' federal tax credit.
The loans were announced on the opening day of NAR's 2009 Midyear Legislative Meetings in Washington, D.C., last week. In his announcement, HUD Secretary Shaun Donovan said guidance would be issued shortly.
When the guidance is released, it is expected to cover eligible lenders and set parameters for loan terms and repayment.
Source: REALTOR® Magazine Online

Springfield Update

IAR State Capitol Report

The General Assembly was in session Tuesday April 28-Thursday, April 30 this week as work continued in committees on various bills. Next week marks a critical deadline- Friday, May 8th is the committee hearing deadline. As you know, the IAR has been actively lobbying against pending legislation (HB 1195 and SB 2101) that seeks to allow ALL municipalities in Illinois to create an independent entity called a “Land Bank Authority” (LBA). It is our understanding that the sponsor and proponents are intending to use one of these bills for limited provisions regarding liens and notices that have been agreed to by the lending lobby and the other bill will be used to advance the Land Banking Authority provisions. The IAR will remain vigilant in our opposition and we urge you to continue to contact your elected officials. The IAR position paper on the Land Banking Authority legislation is available on the IAR website. House Bill 2439, an initiative of the IAR was unanimously approved by the Senate Environment Committee this week. This bill, sponsored by Senator Iris Martinez and Representative Dan Reitz, amends the Illinois Radon Awareness Act to make necessary clarifications to the law, including a provision that clearly exempts transfers involving a dwelling unit located on the third story or higher above ground level, including dwelling units in condominiums and cooperatives. The IAR SUPPORTS this bill which is pending final passage in the Senate. Another radon related bill was also approved in the Senate Licensed Activities Committee. That bill, sponsored by Senator Jacqueline Collins and Representative Dan Reitz, prohibits the sale of a device to detect the presence of radon or radon progeny without the prior approval of the device from the Illinois Emergency Management Agency and requires that all electronic radon detection devices to be calibrated to ensure the accuracy and precision of their measurements. The bill also creates a Task Force on Radon-Resistant Building Codes to make recommendations to the Governor, the IEMA, IEPA and the Pollution Control Board concerning the adoption of rules for building codes. The IAR is represented on the Task Force. The IAR is NEUTRAL. The House unanimously passed Senate Bill 1053 this week marking FINAL action on this bill for the spring session. SB 1053, sponsored by Senator Don Harmon and Representative Sid Mathias, amends the Code of Civil Procedure to extend the time limit within which a judgment for possession obtained in an eviction action may be enforced from 90 to 120 days. The IAR was NEUTRAL on this measure which will be sent to the Governor for his consideration. A duplicate bill, HB 3690 was approved in the Senate Judiciary Committee this week and sent to the Senate floor. The Senate Agriculture and Conservation Committee advanced House Bill 1087 this week. This bill, sponsored by Senator John Sullivan and Representative Dan Reitz, modifies the existing Illinois Forestry Development Act and establishes into State law an Illinois Forestry Development Council. The Council is directed to study and evaluate the forest resources and forest industry of Illinois and the legislation spells out specific duties. A duplicate bill is scheduled to be heard in the House Agriculture and Conservation Committee next week (SB 1413). The IAR is NEUTRAL on these bills. The House Business and Occupational Licenses Committee advanced Senate Bill 1579 this week. This bill, sponsored by Representative Elaine Nekritz and Senator A. J. Wilhelmi, creates the Community Association Manager Act and require managers of community associations (condominiums, cooperatives, townhouse developments and other common interest communities) of more than 10 units to be licensed by the Illinois Department of Financial and Professional Regulation (IDFPR) after January 1, 2011. Licensed real estate brokers and salespersons are exempt from the education requirement. The IAR SUPPORTS this legislation which is now pending in the House. A duplicate measure (HB 271) is scheduled to be heard next week in the Senate Judiciary Committee. Also approved this week in the House Judiciary I- Civil Law Committee was Senate Bill 2111, sponsored by Representative Dan Reitz and Senator Don Harmon. This bill is an initiative of the Land Title Association related to disbursements of funds. An amendment was adopted to make a correction in the drafting of the bill. The IAR is NEUTRAL. The Senate Judiciary Committee approved several bills of interest this week. House Bill 153, sponsored by Senator Iris Martinez and Representative LaShawn Ford, requires that any deed executed under the Code of Civil Procedure or judgment vesting title by a consent foreclosure include the grantee’s or mortgagee’s name and the name of a contact person, street and mailing addresses and telephone number. The IAR is NEUTRAL. House Bill 688, sponsored by Senator Jacqueline Collins and Representative Marlow Colvin, is an initiative of the city of Chicago and is intended to expedite receivership procedures for abandoned or dilapidated condominium property. The IAR is NEUTRAL. House Bill 2351, sponsored by Senator Donne Trotter and Representative Harry Osterman, modifies existing law regarding excess funds from the now defunct Torrens fund in Cook County (Cook County had used this system of recording ownership interest in property- Illinois law abolished it in the early 1990s). The IAR SUPPORTS this bill. Legislation to ban text messaging while driving continues to advance in the General Assembly. The Senate Transportation Committee unanimously approved House Bill 71 this week. The bill prohibits a person from composing, sending or reading an electronic message while driving. Exceptions are in the bill for law enforcement, a driver reporting an emergency situation, a driver using an electronic communication device in hands-free or voice-activated mode and for a driver of a commercial vehicle reading a message on a permanently installed communication device. This bill is sponsored by Senator Martin Sandoval and Representative John D’Amico. The IAR will continue to MONITOR this issue. The Senate Local Government Committee advanced several bills of interest this week. House Bill 466, sponsored by Senator Michael Frerichs and Representative Naomi Jakobbson, amends the law related to pre-annexation agreements. The bill adds Champaign County to those counties specified to follow certain procedures. The IAR is NEUTRAL. House Bill 629, sponsored by Senator Deanna Demuzio and Representative Frank Mautino, specifies smaller site construction site stormwater permit fees. The IAR SUPPORTS this bill. House Bill 2451, sponsored by Senator Dan Rutherford and Representative Ken Dunkin, would allow municipalities to combine costs associated with certain nuisance liens (landscape, trees, garbage/debris, and pests) into a single lien. The bill also makes these four sections more consistent. The IAR is NEUTRAL. House Bill 3987 was debated and approved this week over the opposition of the municipal lobby. This bill, sponsored by Senator Don Harmon and Representative Julie Hamos expands the existing Energy Efficient Commercial Building Act first enacted in 2004 to cover both commercial and residential buildings (with certain exemptions). While HB 3987 expands the Act to cover both commercial and residential buildings there were important provisions added to address specific concerns of the IAR and the Home Builders Association which removed our opposition. The IAR is now NEUTRAL on this measure. Various bills were approved this week in Committee to extend the term of Tax Increment Financing Districts in various municipalities- including Downs (HB 241/SB 1553), Sherman (HB 870), Steeleville (HB 1086), Morris (HB 1628), Macomb (SB 242) and Washington (SB 1277). The IAR is NEUTRAL on these bills. The House Environment and Energy Committee approved Senate Bill 1489 this week with additional language added in an amendment. This bill, sponsored by Representative Elaine Nekritz and Senator Iris Martinez, creates the Green Infrastructure for Clean Water Act. The bill directs the Illinois EPA, in conjunction with the Department of Natural Resources, the Department of Transportation and the Capital Development Board, stormwater management agencies and other interested parties, to submit a report to the General Assembly and Governor on stormwater including green infrastructure use and benefits. Also to be contemplated is the feasibility of devoting 20% of the Water Revolving Fund to green infrastructure, water and energy efficiency and other “environmentally innovative activities” on a long-term basis. The IAR is MONITORING this issue. House Bill 2005, sponsored by Senator Jacqueline Collins and Representative Andre Thapedi, received unanimous approval in the Senate Financial Institutions Committee this week. This bill was negotiated in the House with the IAR and various lending groups. Currently Illinois law provides that if a sale is held and a party entitled to receive notice does NOT receive notice, that party may ask the court to set aside the sale PROVIDED that such party guarantees or secures by bond a bid equal to the successful bid at the prior sale. This bill modifies that language to provide that no such guarantee or bond is required if the party is the mortgagor, the real estate sold is residential real estate and the mortgagor occupies the residential real estate at the time the motion is filed. The IAR is NEUTRal

State Capitol Report is distributed Fridays when the General Assembly is in session. For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org. Full text of legislation cited in this newsletter can be found at www.ilga.gov.

Rep. Froehlich Questioned

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Froehlich QuestionedOver Tax Appeals
CHICAGO - Imagine a state representative knocking on your door, offering to lower your property taxes. That’s exactly what some people who spoke to Fox Chicago News say happened to them.
“[He was] just knocking on the door, introducing himself…and he said would you like my help with your property taxes,” explains Renee and Tom Walsh
Another person, Alan Szczeblowski, recalls, “He had us sign a thing that said he would get our taxes lowered.”
They’re talking about State Representative Paul Froehlich.
“He had forms and I said sure. I signed it and we wound up getting a reduction," says Tom Walsh
They also say that Froehlich asked if he could you put a campaign sign in their yard.
"I said that would be fine. I mean he did me a favor," explains Renee Walsh.
But that leads to the question, was it a savvy political move, a way to win votes, or something else?
Froehlich offered hundreds of taxpayers in Schaumburg, Elk Grove Village and Hoffman Estates a chance to reduce their taxes. Fox Chicago News obtained the names of 175 residents and businesses. Nearly everyone, 94%, won their appeal, from as little as a couple hundred bucks to six figures. How Froehlich did it is now the subject of a Cook County State's Attorney's investigation.
Judy McCurdy was Froehlich’s district office supervisor until he fired her last November. Now, she’s blowing the whistle, providing us with internal documents like a walk sheet he used to visit registered voters. There are notes connecting the tax appeals and campaign signs in his own handwriting
“What he said was these tax savings would translate to votes," says McCurdy.
When we asked Froehlich about the campaign signs he said, “Every elected official that I know of does constituent service, tries to help constituents in a variety of ways."
Those constituents included two of his major campaign contributors. Froehlich helped the owners of the Schaumburg Comfort Inn Suites and Wingate Hotel win big tax reductions. On one internal document, Froehlich does the math, calculating a third of the savings, what a tax attorney would take. Underneath he wrote, "I asked the owner of the hotel and he agreed to cover my sign bill - twelve thousand -- and provide rooms for workers in '08 and '10.
When asked about the note Froehlich replied, “I’ve never had the authority to lower anybody's assessment never. Now if I would have I’d understand your point."
But when we looked at his campaign contributions we found a payment for campaign signs.
Another handwritten note shows Froehlich calculating his own cut from the Wingate tax appeal, more than $14,000. Three weeks later, the Wingate owners began sending checks to pay for his campaign office.
They also picked up the tab for more than $8000 in hotel rooms for campaign workers in last year's election. It was Froehlich's first election after jumping to the Democratic Party and he had the Democratic power brokers behind him, including Joseph Berrios, head of the Cook County Democratic Party and head of the tax board of review. Freohlich and Berrios ran an outreach program to teach residents how to appeal their taxes.
Brendan Houlihan also sits on the tax board. He says he was excluded from the event and all of the appeals generated by Froehlich went to Berrios's staff even though Houlihan's district covers that area. Now the board has launched an investigation of hundreds of appeals filed by Froehlich and whether he was getting inside help.
"Soon we'll have some results to report but meanwhile we're under investigation there'll be more to follow soon," says Houlihan:
And the people whose taxes were reduced got a friendly letter in the mail, not from the tax board, but from Froehlich's office saying, “I'm happy to inform you the assessment appeal I worked out for you was successful

Springfield Update

Illinois Association of REALTORS
State Capitol Report
Friday November 21, 2008

“Anyone who says they are not interested in politics is like a drowning man who insists he is not interested in water.” ~Author Unknown
The House and Senate reconvened in Springfield on Wednesday and Thursday to wrap up the annual fall session.
- An amendment #7 to House Bill 2973 was adopted this week after being worked out among the mortgage lending lobby, the Illinois Department of Financial and Professional Regulation (IDFPR), the Attorney General’s office and other interested parties to address foreclosure actions. The bill adds a new section to the Code of Civil Procedure regarding procedures and forbearances for delinquent residential mortgages. The bill provides that if a mortgage secured by residential real estate becomes delinquent by more than 30 days the mortgagee must mail a notice advising the homeowner that he/she may wish to seek approved housing counseling (defined in the legislation as a counseling agency approved by HUD). No foreclosure action can begin before mailing this notice- which is spelled out in the legislation. If, within the 30-day period an approved counseling agency provides written notice to the mortgagee that the homeowner is seeking approved counseling services, then no legal action shall be instituted for 30 days after the date of that notice. During the 30-day period the homeowner or counselor or both may prepare and proffer to the mortgagee a proposed sustainable loan workout plan (defined in the legislation). The mortgagee determines whether to accept the proposed sustainable loan workout plan. If the parties agree to the plan no legal action shall be instituted for as long as the sustainable loan workout plan is complied with by the homeowner. If IDFPR determines that the demand for counseling services in an area exceeds the number of available approved counseling agencies, the Secretary can certify other persons or entities as approved counseling agencies. However, the legislation prohibits a for profit entity from being certified. The new provisions of this legislation do NOT apply to mortgages issued or originated on or after the effective date of this legislation and ONLY apply to a principal residence. These provisions will be repealed in two years. House Bill 2973, as amended was approved by the Senate on Thursday, November 20th and sent to the House for their consideration when the House returns in January. The bill is sponsored by Senator Jacqueline Collins and Representative Julie Hamos.
- As you may be aware, as part of the Housing and Economic Recovery Act of 2008, Congress included almost $4 billion in funding to HUD to provide for a Neighborhood Stabilization Program (NSP). The Program is intended to provide emergency assistance to state and local governments to acquire and redevelop foreclosed properties that might otherwise become sources of abandonment and blight within their communities. The NSP is designed to provide grants to purchase foreclosed or abandoned homes and to rehabilitate, resell, or redevelop these homes in order to stabilize neighborhoods. All activities carried out under the NSP must benefit households earning no more than 120% of the area median income (AMI), and at least 25% of the funds must benefit households earning no more than 50% AMI. The State of Illinois received a total allocation of approximately $172 million, with about $53 million going towards a state-run program, and the rest of the monies being distributed directly to local governments similar to CDBG monies. IAR provided comments on the proposed plan for the state’s allocation. Local association Government Affairs Directors (GADs) are also working with their local governments on their allocation of NSP. Further information on the program can be found here: www.dhs.state.il.us/page.aspx?item=40593

- The House took final action on legislation this week that had been stalled since the spring session. House Bill 5037, sponsored by Representative Marlow Colvin, deals with distressed condominium property. This legislation is an initiative of the city of Chicago and is intended to expedite receivership procedures for abandoned or dilapidated condominium property. The legislation would allow a court to appoint a receiver to manage the property with the ultimate goal of selling the property and allowing the reuse of the property. The legislation was amended to address concerns raised by the IAR and the banking lobby and the IAR is now NEUTRAL. The bill has been sent to the Senate which has two days in January to consider the legislation.

- Legislation was overwhelmingly approved this week that creates a criminal offense for retaliating against a judge by filing any false lien or encumbrance against the real or personal property of a Supreme, Appellate, Circuit or Associate Judge in Illinois. Senate Bill 2452, sponsored by Senator John Cullerton and Representative Bob Molaro, has been sent to the Governor for his consideration.

- Final action also was taken this week on House Bill 5730 which extends the life of the Tax Increment Financing (TIF) district in the Village of Hoffman Estates from 23 to 35 years. The bill has been sent to the Governor for his consideration.

- Generally, State law requires municipal officials or employees involved in the planning and preparation of a TIF plan or project owning an interest, direct or indirect, in property included in the redevelopment to disclose such interest and to refrain from official involvement or voting on matters related to the area. Further, no member or employee can acquire any property except for specific exceptions added if a single parcel of property is used exclusively as the member’s primary residence. Senate Bill 826, approved by the House this week provides a two-year period whereby a single property interest could be acquired by a member of the municipal corporate authority and NOT constitute an interest in any property provided 1) the property is used exclusively as the member’s primary residence; 2) the member discloses the acquisition to the municipal clerk; 3) the acquisition is for fair market value; 4) the member acquires the property as a result of the property being publicly advertised for sale; and 5) the member refrains from voting on, and communicating with other members concerning, any matter when the benefits to the area would be significantly greater than the benefits to the municipality as a whole. A similar exception was approved in the 2006 session for a one-year period effective in 2007. SB 826, sponsored by Representative Dan Burke and Senator Michael Noland, has been sent to the Senate for consideration in January.

- As we previously reported the current leaders of the Senate, Senate President Emil Jones and Republican Leader Frank Watson, will end their terms as leaders at the end of the 95th General Assembly. Senator Jones did not seek reelection and Senator Frank Watson did not seek reelection as the leader but will remain as the Senator from the 51st District. The Senate Majority and Minority caucuses met this week and selected their new leaders for the 96th General Assembly which begins with the inaugural on January 14, 2009. The new Senate President will be Senator John Cullerton, a Democrat from the 6th District in Chicago. The new Republican Leader will be Senator Christine Radogno, a Republican from the 41st District in LaGrange. The leaders in the House, Michael Madigan and Tom Cross, will remain the same.

- The General Assembly is scheduled to reconvene January 12-13, 2009 to conclude the business of the 95th General Assembly. The 96th General Assembly, as noted above, will be sworn in on January 14, 2009.

- Speaker Michael Madigan has released a calendar for the 2009 session which is available on the General Assembly’s website- www.ilga.gov.

Springfield Update

Illinois Association of REALTORS
State Capitol Report
Friday October 31, 2008

“Do you ever get the feeling that the only reason we have elections is to find out if the polls were right?” ~Robert Orben
- Our legislative newsletter has a new name! “Quorum Call-Week in Review” is now the “State Capitol Report”.

State Capitol Report is distributed Fridays when the Illinois General Assembly is in session. For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org, or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org. Full text of legislation cited in this newsletter can be found at www.ilga.gov.

- After months of campaigning, hard-hitting campaign ads and an incredible amount of work Election Day is a few days away. If you have not already voted through the State’s Early Voting Program or by absentee ballot PLEASE exercise your right and VOTE ON TUESDAY, NOVEMBER 4TH! RPAC was involved in several key races donating contributions and conducting Opportunity Races throughout the State. A summary of the election results will be provided in the next issue.
- The Illinois General Assembly is scheduled to conducts its annual fall veto session on November 12-14 and November 19-21. . While the primary purpose of the six-day fall session is the consideration of gubernatorial vetoes from the spring session, the General Assembly typically considers other initiatives. It should be noted that the House of Representatives cancelled its session days for the first week of the veto session indicating that they had already taken action on the Governor’s vetoes on previous session days this summer/fall. As of today, the Senate is still scheduled to return to Springfield on November 12th.
- Since the last issue of the newsletter final action occurred on a few issues of interest to REALTORS.

--On October 7, 2008 the Governor signed into law Senate Bill 790 (Public Act 95-1000) to authorize the sweep of over $221 million from dedicated funds, including $5 million from the Real Estate License Administration Fund and $250,000 from the Real Estate Recovery Fund. You will recall that this bill creates the Budget Relief Fund to hold authorized swept funds to shore up the State’s General Revenue Fund. While legislators understand all the arguments against the sweep of dedicated funds most will point to the fact that this has been a budget solution used by previous governors. The IAR may have an opportunity for a hearing on the legal merits of this issue in Sangamon County Circuit Court based on our 2006 lawsuit filed in Sangamon County, challenging the constitutionality of such a sweep of the Real Estate License Administration Fund (RELAF). The State of Illinois entered into a stipulation in that case that precludes the State from transferring any funds from the RELAF to be used for any purpose other than those specified in the Real Estate License Act without giving IAR 21 days notice.

--On October 6, 2008 the Governor signed into law Senate Bill 2287 (Public Act 95-999). This legislation, sponsored by Senator Kwame Raoul and Representative Pat Lindner, initially sought to expand the existing Safe Homes Act to allow tenants to recover a minimum of $2,000 plus attorney’s fees from a landlord if the landlord shares “any information provided by the tenant” in exercising his/her rights under the Act to a prospective landlord. The IAR had pointed to a number of concerns with the original legislation including the fact that a tenant would not have to actually incur any damages in order to recover the $2,000. Representative Pat Lindner, amended the bill to hold the landlord liable for actual damages up to $2,000 resulting from the disclosure- instead of liable for any damages resulting from the disclosure or $2,000, whichever is greater. This new language is now in effect-becoming law on the day it was signed by the Governor.


For more information, contact Greg St. Aubin, Director of IAR Governmental Affairs, gstaubin@iar.org, or Julie Sullivan, Assistant Director, Legislative and Political Affairs, jsullivan@iar.org.

President Signs Housing Bill

Bush signs housing bill to provide mortgage relief
By JENNIFER LOVEN, Associated Press Writer1 hour, 55 minutes ago
President Bush on Wednesday signed a massive housing bill intended to provide mortgage relief for 400,000 struggling homeowners and stabilize financial markets.
Bush signed the bill without any fanfare or signing ceremony, affixing his signature to the measure he once threatened to veto, in the Oval Office in the early morning hours. He was surrounded by top administration officials, including Treasury Secretary Henry Paulson and Housing Secretary Steve Preston.
"We look forward to put in place new authorities to improve confidence and stability in markets," White House spokesman Tony Fratto said. He said that the Federal Housing Administration would begin right away to implement new policies "intended to keep more deserving American families in their homes."
The measure, regarded as the most significant housing legislation in decades, lets homeowners who cannot afford their payments refinance into more affordable government-backed loans rather than losing their homes.
It offers a temporary financial lifeline to troubled mortgage companies Fannie Mae and Freddie Mac and tightens controls over the two government-sponsored businesses.
The House passed the bill a week ago; the Senate voted Saturday to send it to the president.
Bush didn't like the version emerging from Congress, and initially said he would veto it, particularly over a provision containing $3.9 billion in neighborhood grants. He contended the money would benefit lenders who helped cause the mortgage meltdown, encouraging them to foreclose rather than work with borrowers.
But he withdrew that threat early last week, saying hurting homeowners could not wait — and even blaming the Democratic Congress' delays in action for forcing an imperfect solution.
Meanwhile, many Republicans, particularly those from areas hit hardest by housing woes, were eager to get behind a housing rescue as they looked ahead to tough re-election contests. Paulson's request for the emergency power to rescue Fannie Mae and Freddie Mac helped push through the measure. So did the creation of a regulator with stronger reins on the government-sponsored companies, as Republicans long have sought.
Democrats won cherished priorities in the bargain: the aid for homeowners, a permanent affordable housing fund financed by Fannie Mae and Freddie Mac, and the neighborhood grants.
The bill takes several approaches to curing the ailing housing market.
It aims to spare an estimated 400,000 debt-strapped homeowners, many of whom owe more their houses are worth, from foreclosure by allowing them to get more affordable mortgages backed by the Federal Housing Administration.
The FHA could insure $300 billion in such mortgages, which would be available to homeowners who showed they could afford a new loan. Banks would first have to agree to take a large loss on the existing loans in exchange for avoiding an often-costly foreclosure.
The plan also is designed to relieve a broader credit crunch that has taken hold because of rising defaults and falling home values. To free up safer and more affordable mortgage credit, the bill permanently would increase to $625,000 the size of home loans that Fannie Mae and Freddie Mac can buy and the FHA can insure. They also could buy and back mortgages 15 percent higher than the median home price in certain areas.
It goes far beyond addressing the current crisis, however.
The legislation overhauls the Depression-era FHA. It requires lenders to show how high a borrower's payment could get under the terms of his mortgage. It provides $180 million in pre-foreclosure counseling for struggling homeowners.
The Treasury Department gains unlimited power, until the end of 2009, to lend money to Fannie Mae and Freddie Mac or buy their stock should they need it. The Federal Reserve takes on a new "consultative" role overseeing the companies.
The measure includes $15 billion in tax cuts, including a significant expansion of the low-income housing tax credit and a credit of up to $7,500 for first-time home buyers for houses purchased between April 9, 2008, and July 1, 2009.
Democratic leaders, recognizing that the measure could be one of the last items to become law during what's left of their abbreviated election-year schedule, tacked on an $800 billion increase, to $10.6 trillion, in the statutory limit on the national debt.
Conservative Republicans were vehemently opposed to the bill, particularly the help for Fannie Mae and Freddie Mac. Critics charge the companies enjoy lavish profits in good times and wield their outsized political clout to resist regulation while depending on the government to bail them out should they falter.

HR 3221

HR 3221, the Housing and Economic Recovery Act of 2008 National Association of REALTORS® Summary (as of 7/24/08)
H.R. 3221, the “Housing and Economic Recovery Act of 2008,” passed the House on July 23rd by a vote of 272-152. The Senate must now approve the language adopted by the House. The Senate is expected to approve the bill on Friday, July 25th or Saturday, July 26th. The President has said he will sign the bill. It includes: GSE Reform – including a strong independent regulator, and permanent conforming loan limits up to the greater of $417,000 or 115% local area median home price, capped at $625,500. The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).FHA Reform – including permanent FHA loan limits at the greater of $271,050 or 115% of local area median home price, capped at $625,500; streamlined processing for FHA condos; reforms to the HECM program, and reforms to the FHA manufactured housing program. The effective date for reforms is immediate upon enactment, but the loan limits will not go into effect until the expiration of the Economic Stimulus limits (December 31, 2008).Homebuyer Tax Credit - a $7500 tax credit that would be would be available for any qualified purchase between April 8, 2008 and June 30, 2009. The credit is repayable over 15 years (making it, in effect, an interest free loan).FHA foreclosure rescue – development of a refinance program for homebuyers with problematic subprime loans. Lenders would write down qualified mortgages to 85% of the current appraised value and qualified borrowers would get a new FHA 30-year fixed mortgage at 90% of appraised value. Borrowers would have to share 50% of all future appreciation with FHA. The loan limit for this program is $550,440 nationwide. Program is effective on October 1, 2008.Seller-funded downpayment assistance programs – codifies existing FHA proposal to prohibit the use of downpayment assistance programs funded by those who have a financial interest in the sale; does not prohibit other assistance programs provided by nonprofits funded by other sources, churches, employers, or family members. This prohibition does not go into effect until October 1, 2008.VA loan limits – temporarily increases the VA home loan guarantee loan limits to the same level as the Economic Stimulus limits through December 31, 2008.Risk-based pricing – puts a moratorium on FHA using risk-based pricing for one year. This provision does will be effective from October 1, 2008 through September 30, 2009.GSE Stabilization – includes language proposed by the Treasury Department to authorize Treasury to make loans to and buy stock from the GSEs to make sure that Freddie Mac and Fannie Mae could not fail.Mortgage Revenue Bond Authority – authorizes $10 billion in mortgage revenue bonds for refinancing subprime mortgages.National Affordable Housing Trust Fund – Develops a Trust Fund funded by a percentage of profits from the GSEs. In its first years, the Trust Fund would cover costs of any defaulted loans in FHA foreclosure program. In out years, the Trust Fund would be used for the development of affordable housing.CDBG Funding – Provides $4 billion in neighborhood revitalization funds for communities to purchase foreclosed homes.LIHTC – Modernizes the Low Income Housing Tax Credit program to make it more efficient.Loan Originator Requirements – Strengthens the existing state-run nationwide mortgage originator licensing and registration system (and requires a parallel HUD system for states that fail to participate). Federal bank regulators will establish a parallel registration system for FDIC-insured banks. The purpose is to prevent fraud and require minimum licensing and education requirements. The bill exempts those who only perform real estate brokerage activities and are licensed or registered by a state, unless they are compensated by a lender, mortgage broker, or other loan originator.For more information, visit www.realtor.org/governmentaffairs