The national mortgage bill received its final congressional approval this weekend and should be signed shortly by President Bush. While the legislation is often described as an effort to rescue those in or near foreclosure, there are elements that could have an impact on the typical homeowner and the local real estate market.

Here are some parts of the soon-to-be law, thanks to stories from The Washington Post and CNN, that could make a difference to you.

 • The bill permanently increases the size of home loans that Fannie Mae and Feddie Mac can buy and the Federal Housing Administration can insure to $625,000. You might remember that earlier this year, Pierce County’s conforming loan limit grew from $417,000 to $567,500. The idea behind raising the limits was to move loans in the $500,000-range from the pricier jumbo loan category in areas where the home prices had moved beyond the previous limits. But rather than being lumped in with the conforming loans and their interest rates, which tend to be among the lowest, lenders created a new category called conforming-jumbo – cheaper than jumbo but more expensive than the standard conforming.

 • The bill includes a tax credit of up to $7,500 for first-time home buyers on houses bought between April 9 and July 1 of next year. The refund, however, must be repaid over 15 years in equal installments.

 • The FHA gets $180 million for preforeclosure counseling to struggling homeowners.

 • Lenders are required to show how high a borrower’s payment could get under the terms of a particular mortgage.

 • The bill increases the downpayment for an FHA loan from 3 percent to 3.5 percent.

 • Homeowners who don’t itemize their tax returns could deduct a portion of their property taxes, expected to be $500 for single filers and $1,000 for joint or married filers. This would be particularly helpful to homeowners who have no mortgage and, therefore, no mortgage interest to deduct and no other reason to itemize.

Rich Bennion, executive vice president of Seattle-based HomeStreet Bank, said Monday that he expects the new conforming loan limit for Pierce County to come in at $522,100. Increasing the limits helps open up lending possibilities to more borrowers, he said.

Also important for the South Sound, he said, is a provision that allows the FHA to streamline the process for making a condominium eligible for an FHA-insured loan. Previously, an entire building would have to meet FHA guidelines, he said.

“That’s significant in our area because increasingly condos and condo conversions are more and more the affordable, entry-level kind of housing. They’re less expensive, and up till now you couldn’t get FHA loans in the typical condo project,” he said.

J. Lennox Scott, CEO of John L. Scott Real Estate, said Monday in an e-mailed statement that the legislation “is an enormous step forward for homeownership.”

He emphasized the opportunity for first-time buyers to take advantage of the tax credit, which he said would help spur home sales activity.

Devona Wells: 253-597-8652

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