I was going to reserve complete judgment on the stimulus bill until after I learned how homeowners and buyers will be affected.

To be brief, the $35 billion proposal promised by the Senate (written about previously) which would have offered a $15,000 tax credit to any home buyer has been chopped.  Instead of $35 billion, the provision is a bit smaller at $2 billion to $3 billion.  And the $15,000 credit has been reduced slightly to $8,000.  And only for first time home buyers.

The ONLY positive move in this shame of an attempt is the the $8,000 will not be a non interest need-to-be-repayed loan like the previous $7,500 first time home buyer credit was.

Congressional aides cautioned Wednesday that the credit’s size was still subject to negotiation.  Super.

A $15,000 home buyer tax credit, higher loan limits for Fannie Mae, Freddie Mac and FHA, and government spending to lower mortgage rates are all in play as Congress and the Obama administration near agreement on an economic stimulus bill and financial stability plan for banks.

The Senate today approved an $838 billion economic stimulus bill that includes a $15,000 home buyer tax credit, just hours after President Barack Obama’s new Treasury secretary unveiled a multitrillion-dollar financial stability plan that includes $50 billion for foreclosure prevention programs.

The financial stability plan may also lead to an expansion of existing efforts by the Federal Reserve to drive down mortgage interest rates by buying mortgage-backed securities and debt issued by Fannie Mae, Freddie Mac and Ginnie Mae.

The version of the economic stimulus bill passed by the Senate in a 61-37 vote relies less on government spending and more on tax cuts to kick-start the economy than the version passed by the House Jan. 28. Only two Republicans voted for the bill in the Senate — Sen. Arlen Specter of Pennsylvania and Maine’s Olympia Snowe — and all 37 “no” votes were cast by members of the GOP.

Differences between the two versions of H.R. 1, the American Recovery and Reinvestment Act of 2009, must now be ironed out in a conference committee.

Original Source~Inman News