The House of Representatives passed a bill last week that went a long way to addressing some of the crucial problems facing homeowners, these days.

I won’t mention the specifics, because they are covered elsewhere. (It’s called the “Mortgage Reform and Anti-Predatory Lending Act of 2007”. Google it.)

Two things though.

First, and foremost, it’s irrelevant that the House passed this bill, because the Senate won’t be discussing it until the new year.

That’s a crying shame, and blame should fall directly on the shoulders of Senator Christopher Dodd, Democrat from Connecticut, and, as we all know from incessant (and mind-numbing) debates, a candidate for US President.

Second, the bill, while giving additional protections to current homeowners and future home buyers, is not necessarily a panacea for everything that ills the nation.

As Holden Lewis put it, succinctly:

There is little doubt that if the bill became law, fewer people would get mortgages. It would result in fewer home sales and refinances. Some would-be homebuyers would have to continue renting. Because there would be fewer buyers, there would be less price pressure on houses. Where house prices are going down, they could fall faster; where they are going up, they would rise slower.

Whether those effects are good or bad depends upon your perspective. Landlords should like the bill because it will expand the pool of renters. First-time buyers will like the bill’s effect on house prices, but only if they can get loan approval under tighter underwriting guidelines.

A slower, but more stable, real estate market?

I’m all for it.

More: See Ya SISA – By Holden Lewis, Mortgage Matters

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Updated:  1st Q 2018

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