President Bush has signed H.R. 3221, otherwise known as The Housing and Economic Recovery Act of 2008. This bill will provide much needed relief for homeowners who are facing foreclosure due the problems caused by the sub-prime mortgage meltdown. This is good news for homeowners facing the loss of their homes as well as the myriad of employees in the real estate and mortgage industries. The ultimate goal of H.R. 3221 is to bring stability to the mortgage industry and provide support to homeowners who are facing possible foreclosure.

This is not a bail out

One of the most important aspects of H.R. 3221 is the HOPE for Homeowners Act of 2008, which creates a new, temporary, voluntary program within FHA to back FHA-insured mortgages to distressed borrowers. This program will help homeowners refinance distressed loans at a significant discount for homeowners at risk of losing their homes to foreclosure. In exchange, homeowners will share future appreciation with FHA. The five principles of the new program as as follows, you can learn more about it here.

1. Long-term affordability
2. No investor or lender bailout
3. No windfall for borrowers
4. Voluntary participation
5. Restore confidence, liquidity, and transparency

myClosingSPACE.com is here to help

In reality not all lenders are going to sign on to this, since it is essentially asking them to take the hit for the drop in value. At myClosingSPACE.com we believe we add value to this bill because we do not charge as much as others, thus keeping the closing costs low. This will be very important to the application of this bill. Should the closing costs exceed a certain amount there is a chance the lender will not be able to do the loan. Further we provide what the industry needs, transparency and a place for the borrower to shop around to lower their costs.