Legislative efforts to improve the housing market come as nearly one-third of mortgage applicants are unlikely to qualify for a loan, according to analysis by the real estate website Zillow Mortgage Marketplace. 

After examining over 25,000 loan quotes and purchase requests, Zillow found that prospective borrowers with a 620 credit score could not qualify for a home loan -- even for those willing to make substantial down payments of 15 percent to 25 percent of the home's selling price. 

Nearly one-third of Americans, or 29.3 percent, have a credit score at or below 620, according to myFICO.com. 

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Democratic leaders are hoping the spirit of bipartisanship that sometimes follows an election will allow them to extend the George W. Bush-era tax cuts for the middle class during the lame-duck session.

President Obama on Monday will sign into law a package of tax breaks and loan incentives for small businesses.

Senate votes on overseas jobs/tax bill this week -- Democrats have set a Tuesday morning cloture vote on the “Creating America Jobs and Ending Offshoring Act of 2010.” Remember, Dems decided last week to bring this bill, not the Bush tax cuts, to the floor for a vote to shape the economic debate heading into the midterms.

WSJ’s Michael M. Phillips on the politics: “Democrats admit they don't have enough votes to defeat a possible attempt by Republicans to block the bill. But they hope that bringing the issue to the Senate floor will underscore their concern about unemployment, now at 9.6%... ‘This is another in a series of bills designed to try and provide jobs here at home for the American people,’ a spokesman for Senate Majority Leader Harry Reid said Sunday. ‘Just because the Republicans say 'No,' doesn't mean we shouldn't try.’” http://bit.ly/d1huwE

The measure includes tax incentives for multinational companies to keep jobs and operations at home instead of abroad.

Business groups aren’t happy about it, reports The Financial Times. While the bill would provide a payroll tax exemption for companies that that bring overseas jobs back home, it would also limit tax deferral for U.S. companies’ overseas profits and deductions for U.S. plant closings. “The National Association of Manufacturers took specific aim at the provision on the deferral of taxes on foreign income, saying it would ‘place US affiliates at a cost disadvantage vis-à-vis their foreign-based competitors...’” http://bit.ly/ahQQIM

But... There’s more than $1 trillion in profits of U.S. multinationals that stay overseas due to tax policies. That money could help at home, where lawmakers are struggling to pay for programs and close deficits, economists tell WaPo. “Advocates of repatriating that money say it could finance hundreds of thousands of new jobs, research and development and other investment that could lift the economy from the doldrums...” http://bit.ly/cNFBt3

REST OF THIS WEEK

Tuesday: Home price index for May, June and July due out. Also, consumer confidence index for September to be released.

Thursday: Bernanke to talk Wall Street reform implementation at Senate Banking Committee; final estimate for 2Q GDP due (initial estimate of 2.4 percent was downgraded last month to 1.6 percent)

Friday: Manufacturing data for September and construction spending for August.

More on the economic agenda. http://bit.ly/d7w4vy

Friday is also the start of the federal fiscal new year. Get the hats out... http://onion.com/aRgO9f

TAX CUTS -- Vote probably not this week, said Majority Leader Hoyer and David Axelrod on the Sunday shows. http://bit.ly/bSzpdl

But there's still a chance, says Rep. Van Hollen. If it does come, it’ll likely be on a suspension vote. TPM: http://bit.ly/bkH9Ha

Also not forthcoming... Fannie/Freddie reform. Not even after the election. WSJ: http://bit.ly/aoaBkA

CHINA -- Robert J. Samuelson: Currency Hawk. The Post columnist calls on the U.S. to up the pressure on the Chinese government for holding down the yuan’s value, even if that risks a trade war. “The trouble is that China has never genuinely accepted the basic rules governing the world economy. China follows those rules when they suit its interests and rejects, modifies or ignores them when they don't... As the old order's main architect and guardian, the United States faces a dreadful choice: resist Chinese ambitions and risk a trade war in which everyone loses; or do nothing and let China remake the trading system. The first would be dangerous; the second, potentially disastrous.” http://bit.ly/cacn0U

But China isn’t having it... central bank official speaks out against currency rise, saying it would “achieve no results” in closing international payments imbalances. Reuters: http://bit.ly/aOY58j

Chinese government is slapping tariffs on U.S. poultry. NYT: “The tariffs are another example of China’s willingness to use its economic leverage when it feels it is being challenged...” http://nyti.ms/bisMfh

Bloomberg Hed: “China's Charm Blitz in `Shambles' Over Regional Spats” -- In addition to currency and poultry fights, the Chinese government recently clashed with Japan over a fishing boat captain and opposed joint U.S.-South Korea military exercises. http://bit.ly/bUbvo6

WALL STREET RALLIES FOR GRIDLOCK: Prospect of split government may be driving stocks upward. WSJ:  “‘There is a good chance that the strength we have seen in the market recently is due partly to an expectation about the result of the election,’ says Jason Trennert, chief strategist at Strategas. ‘Investors are starting to understand that a likely result of this election is gridlock, and that is good.’ ... He notes that industries whose stocks make up about 40% of the value of the S&P 500—financials, energy and health care—have been raked over the coals by Congress this year. Wall Street is hoping Congress will ease up after the election. ... [M]any investors also are hoping that the election will result in the continuation of the Bush tax cuts for the wealthy.” http://bit.ly/angcZE

Obama administration wants banks to report all transactions going into or out of the U.S. to help spot terrorist activity. Currently, only transactions involving more than $10,000 must be reported. http://bit.ly/8ZlXFC

If the Bush tax cuts aren't extended or ended by Dec. 10, it could be too late to withhold the right amount.

The delay comes as a direct response to the tens of thousands of public comments received in response to the proposal.

Rep. Darrell Issa (R-Calif.) called the Democrats' move "embarrassing" and accused the party of being more concerned about winning midterm elections.

But House Majority Leader Steny Hoyer (D-Md.) blamed the Senate while acknowledging "I doubt we will" get to it before leaving.

Several House Democrats slammed Fannie Mae this week over reports that, in Florida, the mortgage finance giant has hired experts at expediting foreclosures to run programs designed to prevent them. 

"In other words, Fannie Mae seems to specifically delegate its foreclosure avoidance obligations out to lawyers who specialize in kicking people out of their homes," Democratic Reps. Barney Frank (Mass.), Alan Grayson (Fla.) and Corrine Brown (Fla.) wrote Friday to Fannie CEO Michael Williams.

Furthermore, some of those same "foreclosure mills" — legal firms hired by mortgage servicers to expedite foreclosures — are under investigation for fraud and backdating documents, the lawmakers note, citing recent news reports.

The lawmakers want Fannie, "at the very least," to cut ties with those firms under investigation. 

“Why is Fannie Mae using lawyers who are accused of regularly engaging in fraud to kick people out of their homes?" the lawmakers asked.

Florida has been among the states hit hardest by the foreclosure crisis that followed the bursting of the housing bubble in 2008. In August, foreclosure papers were filed on almost 57,000 residential properties statewide — activity that included more than 12,000 repossessions, according to RealtyTrac, an online foreclosure database. Only Nevada fared worse. 

In Friday's letter, the Democrats urged Fannie to establish strict new rules allowing mortgage servicers to foreclose on homes "only when its legal entitlement to foreclose is clearly documented." 

A Fannie representative told The Washington Post Friday that the company "will respond to the questions raised."