US President George W. Bush on Wednesday signed a sweeping housing rescue plan designed to help 400,000 homeowners avert foreclosure and bolster ailing mortgage finance giants, the White House said. Bush signed the broadest housing legislation in decades “to improve confidence and stability in markets, and to provide better oversight for (US mortgage lenders) Fannie Mae and Freddie Mac,” White House spokesman Tony Fratto said. “The Federal Housing Administration (FHA) will begin to implement new policies intended to keep more deserving American families in their homes,” Fratto added. Treasury Secretary Henry Paulson and senior FHA leaders were at Bush's side during the low-key signing ceremony for the Housing and Economic Recovery Act of 2008, which legislators from both sides of the aisle have described as vital to stem fallout from a slumping housing sector. It makes available 300 billion dollars in federal guarantees to help refinance troubled mortgages, and provides for government credit and equity injections in Fannie Mae and Freddie Mac, the two mortgage lenders that underpin much of the housing market, and calls for some 3.9 billion dollars to help local governments buy and rehabilitate foreclosed homes. Opponents to the bill had argued that it would reward “irresponsible” lenders and consumers and allow the government too big a role in the housing market. The bill's supporters stressed that providing a financial lifeline for the government-sponsored Fannie Mae and Freddie Mac as well as more regulatory oversight would contribute to confidence and stability in housing and financial markets.
