Washington, DC—Senate Majority Leader Harry Reid made the following statement today regarding the FHA Modernization Act and Mortgage Forgiveness Debt Relief Act of 2007 passed in the Senate today:
“Democrats have delivered on our promise to help homeowners affected by the subprime and foreclosure problems facing this country. The Senate today passed two important measures that help struggling homeowners, some of whom might be facing the horrible specter of foreclosure. Earlier today, the Senate passed a bill that will modernize the Federal Housing Administration. With this bill, struggling lower-income homeowners will have a safer option for refinancing, and first-time homeowners will have a good alternative to the exotic, teaser-rate loans that were a root cause of the foreclosure crisis confronting our nation.
“We also passed the Mortgage Forgiveness Debt Relief Act of 2007. Among other things, this legislation will ensure that borrowers whose homes were foreclosed or who are under financial stress and have their mortgages modified will not be penalized by the IRS. These families simply do not need the added burden of a tax bill, and this bill prevents that.
“There is much more to do, but these measures are critical first steps. Senate Democrats intend to continue to work to ensure these items are signed into law as quickly as possible.”