The Federal Reserve plans on sending Congress legislative recommendations on how to help the housing market recover, Senator Dianne Feinstein said on Thursday after a meeting with Fed Chairman Ben Bernanke.
Democratic lawmakers, who met with Bernanke at their weekly policy luncheon, said he stressed that more needed to be done to help the housing sector, which has hindered the U.S. economic recovery and forced the Obama administration to retool foreclosure prevention programs.
They are going to submit a list of recommendations next week, Feinstein told reporters. She said the pending proposals are legislative recommendations we can look at.
Senator Mark Warner said Bernanke spoke about what can be done to get mortgage refinance moved down the field.
There might be some ideas we are going to have shortly on that, he told reporters after the meeting.
It is unclear what Congress might do given deep political divisions in the House of Representatives and the Senate.
A handful of Senators are trying to advance a proposal that would make it easier for middle-class Americans to buy homes in expensive real estate markets.
The administration is pushing the regulator for Fannie Mae
The Fed has been exploring what steps it might be able to take to spur a more vigorous recovery and pull down an unemployment rate that has been stuck above 9 percent for five straight months. Bernanke has called the U.S. employment situation a national crisis.
The U.S. central bank has kept rates at near zero since December 2009 and has said it would likely keep rates at that level there at least through the middle of 2013. It has also bought $2.3 trillion in bonds in a further effort to lower borrowing costs.
In September, the Fed decided to shift its holding of bonds to try to put more downward pressure on longer-term rates. It also said it would begin reinvesting principal payments from its holding of mortgage-related debt to help housing.
(Reporting by Thomas Ferraro, Rachelle Younglai and Tim Ahmann; Editing by Sandra Maler, Vicki Allen, Leslie Adler)