After bailing out Bear Stearns, Washington may throw a lifeline to homeowners facing foreclosureSince the start of the housing crisis, the Bush Administration has resisted using taxpayer funds to help out homeowners directly. But that resolve has weakened in the wake of the $29 billion bailout of Bear Stearns (BSC). After rushing to aid Wall Street, Washington can't very well refuse to help out struggling homeowners on Main Street. Congress is now making headway on a series of proposals aimed at bolstering the housing sector, while the White House is readying its own moves. Here's a look at what's in the works:
What are the different proposals?
Senators Christopher J. Dodd (D-Conn.) and Richard Shelby (R-Ala.) are backing a deal on a housing stimulus package that would include a $7,000 tax credit for those who buy a home in default or foreclosure, a $10 billion boost in the value of bonds that states can issue to help borrowers refinance, and tax credits for money-losing homebuilders and other businesses. In addition, momentum is growing for separate legislation that would directly aid struggling mortgage holders.
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