Friday May 9, 02:04 AM
US House-approved mortgage crisis bill faces veto
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WASHINGTON (AFP) - The US House of Representatives has approved a bill that lawmakers hope could stem the tide of home foreclosures due to the subprime mortgage crisis, but it faces a presidential veto.
The Democratic-controlled chamber passed by a vote of 266 to 154 the bill which would create a 300-billion-dollar federal guarantee for new mortgages for people who may be at risk of losing their homes.
"This legislation, in short, will expand the FHA (Federal Housing Administration) program so that borrowers in danger of losing their homes can refinance into lower-cost, government-insured mortgages that they can afford to repay," said Democratic majority leader Steny Hoyer.
However, some Republicans argue that the bail-out approach would harm the US economy.
"House Democrats are forcing responsible homeowners and taxpayers to pick up a 300-billion-dollar tab to bail out scam artists, speculators and reckless borrowers," said Congressman John Boehner.
"Let's be clear: This is a dangerous approach and undermines the American dream of owning a home."
President George W. Bush said on Wednesday he intended to veto the measure.
"We are committed to a good housing bill that will help folks stay in their house, as opposed to a housing bill that will reward speculators and lenders," he said, adding that there was an "alternative" Republican-sponsored bill that "will do the right thing for the American people when it comes to housing."
The Senate, meanwhile, is working on its own version of a similar bill on the housing crisis.
Democratic Senator Chris Dodd hailed the work done by the House as "a clear signal to Americans -- and the White House -- that Congress is committed to helping people keep their homes and stabilize the markets."
He said his colleagues in the Senate Banking Committee were working to "pass bipartisan legislation to reduce foreclosures and restore liquidity to the mortgage market."
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