Monday, November 02, 2009


Senate Majority Leader Harry Reid said that the first time home buyer tax credit could be approved as early as Tuesday, November 3rd. There is a vote scheduled for late on November 2nd. “The House said that they would accept that and that could be done as early as November 3rd,” said Senator Reid. The delays in approving the bill has been due to the Republican demands for votes on amendments including the expiration of TARP funds by the end of 2010.
The November 2nd vote would allow Democrats to ignore the amendments if the bill is approved. Democrats have a plan to extend the first time home buyer tax credit until April 30th. The revised plan will also allow higher income home buyers to qualify for the tax credit. There is also an addition to the bill that home buyers who lived in their prior homes for at least five years could receive a credit of $6500. The increases of income for the tax credit are up to $125,000 for an individual and $225,000 for a couple from $75,000 and $150,000, respectively.

In addition, the House Appropriations Committee has approved an extension of the $729,750 loan limits for Fannie Mae, Freddie Mac and the Federal Housing Administration through September 2010. The committee also increased the lending and guarantee authority of FHA and Ginnie Mae, as requested by the Obama Administration. The Department of Housing and Urban Development appropriations bill authorizes FHA to insure $400 billion in single-family loans during fiscal year 2010, up from $315 billion in the current 2009 fiscal year, which ends Sept. 30. The FY 2010 appropriations bill allows Ginnie Mae to guarantee up to $500 billion in securities backed by single-family and multifamily loans. Congress provided the secondary market agency with $400 billion in MBS guarantee authority in the FY 2009 appropriations bill. The massive stimulus bill that President Barack Obama signed in February raised the maximum loan limit for the GSEs and FHA to $729,750. But the higher limit is due to expire at year-end, if the full House as well as the Senate does not approve this bill.

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