What the housing package could mean to you

July 31 2008 - The far-reaching federal housing package signed into law Wednesday by President Bush could help tens of thousands hold onto or buy homes across California, critical aid for the state hit hardest by foreclosures.

Three components of the Housing and Economic Recovery Act of 2008 are likely to have the most direct consumer impact: a Federal Housing Administration program authorized to insure up to $300 billion in refinanced mortgages, new caps on loans that government-sponsored enterprises Fannie Mae and Freddie Mac can buy or back, and $15 billion in housing tax breaks.

The latter two will increase demand for foreclosed homes lingering on the market as the refinancing plan prevents additional ones from reaching that point, said Beth Peerce, treasurer of the California Association of Realtors, a Los Angeles trade group.

“Once those foreclosures are gone, if you and your wife want to move, you can put your home on the market at a reasonable price,” she said. “What we’re going to do is get back to a nondistressed market.”

What the housing package could mean to you
James Temple | Chronicle