Big news in the foreclosure crisis today as in a rare Saturday session the senate approved the housing rescue bill.  Get the full story at http://www.msnbc.msn.com/id/25848449/ .

"This is far more than sending a bill to the president's desk for his signature. It's sending a message to the American people that the Congress of the United States despite an alternative reputation can actually get things done, and can work together to achieve a good result," said Sen. Christopher J. Dodd, chairman of the Senate Banking, Housing and Urban Affairs Committee.

The Senate voted 72-13 to send the bill to the president. This bill would allow the Federal Housing Administration to guarantee as much as $300 billion in lower-cost mortgages- provided that lenders accept significant losses. This provision could help at least 400,000 homeowners.  This bill would allow homeowners who cannot afford their payments to refinance into more affordable government backed loans instead of losing their homes.

But what does it mean for us in Ohio and Cuyahoga County?  We are an area that has been particular hard hit by the foreclosure crisis.  The Plain Dealer reports today on page A12 that "In Cleveland, where median home prices have plunged 75 percent, officials are counting on a countrywide land bank program to help deal with blighted properties left behind. Cuyahoga Country needs approval from the state legislature for a land bank, which would allow it to seize abandoned houses and either demolish them or repair and sell them."

Crain's Cleveland   http://crainscleveland.com/article/20080724/FREE/6   says Cleveland stands to gain an estimated $58 million in federal funds to obtain, repair and resell foreclosed homes under the bill, according to Sen. Sherrod Brown (D-OH). The funds will filter to local communities through the U.S. Community Development Block Grant program. The funds also could aid related projects in neighborhoods hard-hit by foreclosure.

Is this bill just a way to bail out irresponsible homeowners and lenders and make Washington look good in an election year? Time will tell.  In the meantime it may help cities like Cleveland get back on their feet.

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