Appraisal Pros Prose

Last week, The Wall Street Journal reported that US Senate lawmakers, increasingly aware of the role of housing and the economy will play in the upcoming elections, took a major step towards passage of a broad package of legislation Tuesday.

They voted to limit debate on the package that includes tax relief, a program to refinance up to $300 billion in mortgages for cash-strapped borrowers and change the FHA to ease the agency's ability to assist homeowners.

Both Democrats and Republicans are expected to support the bill, despite the threat of a veto from the White House.

Part of the bill calls for lenders to voluntarily write down the value of a distressed loan in order for the homeowner to qualify for the new FHA-backed loan. In return, borrowers would have to share future appreciation with the federal government.

In other news, Countrywide's troubles mount as officials in three states filed separate legal actions against the mortgage lender. Bank of America is expected to purchase the Countrywide Financial Corp. by July 1st. California, Illinois, and Washington have filed in their state courts, alleging that Countrywide used "misleading marketing practices" to steer buyers into "risky and costly loans" to satisfy Wall Street's call for loans that could be packaged into securities. The state of Connecticut is expected to follow shortly by filing its own suit, alleging that Countrywide is "falsely promising refinancing opportunities and lying to consumers about possible risks", says Connecticut Attorney General Richard Blumenthal.

And, lastly, Fannie Mae and Freddie Mac, have scrapped the restriction of demanding higher down payments from buyers whose properties are located in a "declining" market area. Fannie Mae's senior vice president , Marianne Sullivan, said the policy was reversible because of improvements to the company's automated underwriting systems, allowing it to "assess each loan more precisely."

And, so, 'til next time, it's all good!