On Friday the Senate passed new legislation that would make more Federal Housing Administration Loans available to troubled borrowers facing foreclosure, lowering the down payment required and allowing larger loans. The House passed similar legislation in September, and now House and Senate members will have to "resolve a number of differences between the two pieces of legislation," says the Wall Street Journal.

Bloomberg observes: "The agency's loan terms, which are more stringent than those of many lenders, may have caused some borrowers to turn to subprime mortgages. Housing officials estimate that the legislation will help about 200,000 homeowners who have fallen behind on their mortgage payments." The housing industry, including home builders and real estate agents, pushed for the legislation because they will benefit from the expansion of F.H.A. loans, says Bloomberg.
"This legislation is the perfect example of the kind of help Americans are looking for," Senator Charles E. Schumer, a New York Democrat who was a sponsor of the bill, said on the Senate floor. "It is definitely and desperately needed."

Consumers with banking complaints reflexively complain to the FDIC or their state Attorney General, even though five federal agencies regulate the banking industry. A bill introduced by Carolyn Maloney (D-NY) wants to connect aggrieved consumers to the right agency by Losses from the subprime meltdown are going to hurt Bank of America, but they won't say how badly. They just want investors to be prepared when the 4th quarter numbers come in, says the NYT.

Kenneth Lewis says Bank of America's fourth quarter is going to be grim. How grim? Well, he isn't talking specifics, but he did say at a Goldman Sachs conference early Wednesday that "you can certainly assume results will again be disappointing."

He also expects the bank to take bigger write-downs on collateralized loan obligations than the $3 billion that have previously been reported. How much bigger? Mr. Lewis didn't go there, either. In fact, he said the final write-down amounts were "unknowable." We're not experts or anything but that sounds "bad."

Reuters is reporting that government-backed mortgage lender Freddie Mac expects to lose $10-12 billion before the subprime meltdown is over. Previously, everyone was freaking out about their $2 billion loss.
"We would expect that our total future credit losses on our current book of business would total approximately between $10 billion and $12 billion," Chief Executive Officer Richard Syron told an investors conference sponsored by