Act would relieve rising foreclosures

The act would authorize state housing agencies to issue $10 billion in tax-exempt bonds, according to a news release from Bond’s office. Proceeds from the bonds would be used to help refinance subprime mortgages.

Additionally, the act would expedite $180 million approved by Congress last year for foreclosure counseling. A $15,000 tax credit also would be offered for purchasing a home in or approaching foreclosure.

A provision in the bill also would allow firms qualifying for tax rebates based on their operating losses to spread their losses over additional profitable years, in order to claim the full value of their losses, according to the release.

New regulations in the legislation also would require borrowers who are considering an adjustable-rate mortgage to be educated on any introductory rates and payments, expiration dates, what the adjustable rate will be, what the payment will be under a higher rate and any prepayment penalties.

The bill also offers extended protection for soldiers returning from overseas deployment who face foreclosure when they arrive. Provisions would extend the three-month protection from foreclosure to six months.

The act does not expand bankruptcy laws, which would make home ownership more expensive by forcing interest rates up, increasing the cost of borrowing and encouraging costly litigation.

There is no word from Democratic lawmakers on when the bill could go up for a vote, according to Bond spokesman Charles Chamberlayne.