WASHINGTON – The House of Representatives yesterday passed a massive housing rescue bill, which now includes bailout provisions for Fannie Mae and Freddie Mac, while the White House dropped a threat to veto it.
The bill now moves to the U.S. Senate, where a vote may take place later this week or early next week.
The bill would provide up to $300 billion in federal guarantees for refinanced subprime mortgages, a $7,500 tax break for first-time home buyers, as well as create a new regulator for the two secondary mortgage market giants. It also includes provisions introduced by the Bush administration to provide a federal backstop for the two troubled government sponsored enterprises. That would include a much bigger guaranteed line of credit with the Treasury for both Fannie and Freddie and power for the Treasury to buy stock in either in times of crises.
