Lawmakers Progress Towards Housing Fix

Lawmakers today announced progress towards a housing fix that both parties can agree on. The Senate has gotten some bickering out of their system and they're ready to work together (for a while). The proposal announced today would be based on House Financial Services Committee Chairman Barney Frank's plan. MarketWatch.com summarizes the Frank plan:

"Under the Frank bill, lenders would reduce the principal of the mortgages to take account the new lower value of the home. The borrower would get a fixed rate loan from the Federal Housing Authority. In return, the government would get a small stake in the home".

We'll see if it flies. Everybody's afraid of a bailout, but inaction isn't widely appealing either. It sounds like this approach gives taxpayers some equity in rescued homes -- and the potential for profit. That should help win over the anti-bailout group.