This is an excellent article that highlights some of the pros/cons of the housing aid bill that Bush just signed today.

Bottom line is that it's no silver bullet or panacea, but it is an important first step to provide aid to owners, buyers, banks and the market as government continues to find ways to improve upon the current situation.

Quoted: The problem," says Vogel of the Tuck School, "is that in order to refinance out of a loan, the lender has to allow it." That means the lenders have discretion to keep for themselves the "better" mortgages and to designate the less promising ones for insurance backing from the government.

While not perfect, it's a relief to many struggling homeowners that this bill passed. Without this, foreclosures would continue to increase dramatically and the troubled FNMA and FHLMC's impending collapse would send tidal waves that would further harm everyone.

Yes, many of the parties being bailed out have to share some of the blame. But let's get past the blame game and move forward in addressing the larger issue of economic recovery and market stabilization.

Quoted: President Bush has signed a massive housing bill intended to provide mortgage relief for 400,000 struggling U.S. homeowners and stabilize financial markets.

It's one thing to fudge numbers on applications to qualify buyers - that's bad enough - it's horrendous to lie to people and charge them absurdly high interest or fees without their knowledge.

These lenders are directly responsible for the problems in the housing and mortgage markets, which are now affecting our economy in general and everyone in it. They deserve the maximum punishment allowable.

Quoted: Their battle comes as state regulators have cracked down on mortgage abuse, bringing charges against lenders and brokers for charging unlawful or excessive fees, failing ...

Not good news for JPMorgan/Chase, but they can deal with this.

Problem is that WaMu is headed for some trouble too (good thing I didn't buy that stock when it I thought it was cheap at $10/share!). There have long been talks that WaMu might be bought by Chase should it continue to head towards financial woes, but seeing as how things are with the big banks, I find it unlikely that any financial institution bigger than WaMu would be able to buy it now.

Good news. Wells Fargo remains as one of the strongest mortgage lenders. For a bank, they still have a good number of mortgage products.

Quoted: NEW YORK (Reuters) - Wells Fargo & Co , the fifth-largest U.S. bank, reported surprisingly strong quarterly results and raised its dividend, easing investor fears about mortgage losses and causing its shares to soar on Wednesday.

Not good. Additional impacts to the current credit crunch crisis will make it even more difficult for people to get mortgages, leading to more problems in the housing market and the economy in general. Expect housing prices of desperate sellers to drop in the near future based upon banking trends.

Quoted: Shares of Fannie Mae and Freddie Mac plummeted Friday as Wall Street and Washington became more convinced that the government is likely to bail out the nation's key mortgage financiers.

Too late to help much this time around, but good to prevent a future catastrophe. I believe that if the rule are too restrictive, though, it will prevent a faster recovery of the housing market and the overall economy. What few people talk about is how much the tighter lending restrictions have hurt ready & willing buyers who are excluded from overly-restrictive mortgage regulations. Self-employed people, for example, will not have stated-income loan products for much longer.

Quoted: The Mortgage Bankers Association urged the Fed to "take a balanced approach in devising final regulations so that the credit crisis is not worsened." Meanwhile, the Center for Responsible Lending, a group that promotes homeownership and works to curb predatory lending, warned the Fed that weak regulation and oversight has led to the "worst credit crunch in generations."

FHA loans are indeed making a comeback. The class I went to said that at one point, they accounted for over 1/3 of total mortgages and now, they account for less than 5%.

A streamlined FHA process means that it will be faster and less hassle to do an FHA loan that what we've been used to in past years.

Quoted: FHA-insured loans traditionally have been a resource for first-time buyers and those with blemished credit because they require only a 3 percent down payment, have lower credit standards than conventional loans and allow borrowers to use gift money for down payments and closing costs.