Housing help needed

Our view: Congress should act quickly to aid homeowners

June 26, 2008

With housing values continuing a long, ugly slide and foreclosures rising at a record pace in Maryland and across the nation, the Senate should act quickly to approve a rescue package that could allow as many as 400,000 troubled borrowers to stay in their homes by refinancing into more affordable government-insured loans. It's not only about helping beleaguered homeowners but also shoring up the neighborhoods in which they live.

The legislation also would create an $8,000 credit for first-time buyers of vacant homes and offer aid to communities to help fight the effects of widespread foreclosures. The House has passed similar legislation, and there is strong bipartisan support for the proposal, despite doubts expressed by the White House.

Evidence of the need for substantial action is everywhere. Nationally, lenders are filing more than 8,000 foreclosures every day, and in Maryland, housing prices are off 15 percent over last year.

Members of Congress have been arguing for months over how to help distressed homeowners without rewarding real estate speculators and lenders who made inappropriate loans. The proposed legislation answers those concerns in suitable ways.

The plan offers $4 billion that could be used by Baltimore and other cities to purchase and renovate as many as 120,000 abandoned homes and would authorize states to issue $11 billion in mortgage revenue bonds that could be used to encourage the purchase of an additional 87,000 low-income units.

Passage of the bill would be welcome in Maryland, where the number of homeowners behind on their mortgage payments jumped a record 70 percent in the past year. Until a struggling housing market recovers, the economic future will remain clouded.

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