As realtors watch, Congress edges closer to a housing bill

WASHINGTON — The nation's Realtors came to Capitol Hill this week to urge passage of housing legislation, and they could hardly have timed it better.

After months of legislative stalemate, key senators spent Thursday working on a compromise to advance housing-rescue package. As hopes rose that a deal was near, the Realtors felt their meetings with senators and representatives were having an impact.

"It's very energizing," Realtor Jerry Mitchell said at the National Association of Realtors' weeklong annual meeting in Washington.

"We are having a voice," said Mitchell, who works in the North Palm Beach office of Illustrated Properties Real Estate.

And that unified Realtors' voice is shouting to Congress: Pass a housing package that would help financially struggling homeowners.

Late Thursday afternoon, Senate Banking Committee Chairman Christopher Dodd, D-Conn., called a committee hearing to announced that "we're very close" to a compromise with Republicans. He predicted an agreement would be reached within days.

Dodd is negotiating with his committee's senior Republican, Sen. Richard Shelby, of Alabama. Republican support is vital because the Bush administration has been threatening a veto. The legislation could survive a veto only with broad bipartisan support.

As the Realtors arrived at the start of the week, prospects for compromise appeared dim. But amid an economic slowdown in an election year, key Republicans decided to resume negotiations in the Senate.

The House already has approved a bill crafted primarily by House Financial Services Committee Chairman Barney Frank, D-Mass. His package would offer federal insurance on $300 billion in new mortgages to help strapped homeowners refinance into cheaper, fixed-rate loans.

The legislation also would modernize the Federal Housing Administration, a Depression-era mortgage insurer, and reform the government-sponsored mortgage companies Fannie Mae and Freddie Mac.

Supporters say Frank's legislation, known as the American Housing Rescue and Foreclosure Act, would prevent hundreds of thousands of families from facing foreclosure. But the Bush administration says the bill would amount to a bailout for lenders and could shift too much risk to taxpayers.

Dodd said his committee must respond to the housing crisis. "Inaction is not an option," he said.

But Banking Committee member Sen. Jim Bunning, R-Kentucky, said he opposes legislation that would amount to "a bailout for irresponsible lenders," and for "borrowers who lied" about their income.

Thursday began with Frank speaking to a hotel ballroom packed with Realtors. He said Congress must help the hard-hit housing sector.

"We are responding to a crisis" created by the failures of lending regulators, he said. "It was too little government - not too much - that has brought us here," he said.

Frank said the free market is solving the problem to an extent - lowering home prices enough to make housing more affordable. But price drops must be gradual, he said.

"I should lose 15 pounds, but not in two days," he said. "People need time to adjust."

Frank's speech was greeted with chuckles and hearty applause. Afterwards, a group of Realtors from hard-hit South Florida discussed their impressions of Frank's leadership.

"He's a wonderful ally," said Scott Wingfield, a Realtor from Port St. Lucie, Fla. "He's leading the fight."

John Mike, chairman of the Realtors Association of the Palm Beaches in Florida, said that because of Frank's reputation as a liberal, "I was skeptical." But Frank's willingness to help the real estate industry has been impressive, he said.

"He's a revelation," Mike said.

The real estate agents said they were glad to have spent the week walking around Capitol Hill to meet with their senators and representatives.

Chuck Bonfiglio, president of the Florida Association of Realtors, said that in his state, about 16 percent of Realtors dropped out in the past year. After so much bad news, it was good to see lawmakers trying to help, he said.

Meeting with elected representatives in the nation's capital "rejuvenates you," he said. "I feel like I've learned something."

Marilyn Geewax is a Washington correspondent for Cox Newspapers.