FOR IMMEDIATE RELEASE
Friday, December 14, 2007

Isakson Praises Senate Passage of FHA Reform Legislation
Provides Alternative to Subprime Mortgages For Struggling Home Buyers

WASHINGTON – U.S. Senator Johnny Isakson, R-Ga., today praised the Senate’s passage of legislation to modernize the Federal Housing Administration’s mortgage insurance program by making FHA-insured loans more competitive and by giving struggling home buyers a sound alternative to subprime loans.

The FHA Modernization Act of 2007 (S.2338) passed the Senate by a vote of 93-1. The House has passed its own version of an FHA reform bill and the two chambers must now seek to reconcile the differences between the two bills.

“I am very pleased this legislation passed with such strong support. In the wake of the subprime mortgage crisis, many home buyers are going to look to the FHA to refinance. We are fortunate that in this time of crisis, our government-insured mortgages are sound and can help fill an important need,” said Isakson, who spent more than three decades as a Realtor in the real estate business.

The legislation would increase the dollar limit on FHA mortgages, giving buyers in states with more costly real estate a competitive alternative to risky subprime loans. In addition, the bill lowers the required minimum downpayment for an FHA-insured loan, and requires borrowers who put down less than 3 percent of the appraised value to undergo counseling.

###