[Update 1 reflects statements released late Monday by the White House] President-elect Barack Obama and his transition team are reportedly in discussions about how best to use the remaining $350 billion from the $700 billion bailout. The team is in negotiations with key lawmakers as of Monday to come to some kind of agreement and avoid political squabbling over the remaining Troubled Asset Relief Program (TARP) funds, according to a Wall Street Journal report. Of the funds’ uses being discussed are foreclosure prevention and “tougher” conditions imposed on recipients of TARP funding. Obama’s team mid-day Monday asked President George W. Bush for his approval in releasing the second half of the TARP funds, according to White House press secretary Dana Perino. With Bush’s approval, the motion to release the funds could still be subject to Congressional disapproval. Despite some vocal criticism in the past regarding a lack of transparency in the Treasury Department‘s implementation of TARP funds, several key lawmakers have rallied to go forward with the rest of the funding under revised program terms. They are led by House Financial Services Committee chairman Barney Frank, D-Mass., who on Friday released the outline of a bill that aims to amend the TARP by strengthening accountability, closing loopholes, increasing transparency and requiring the Treasury Department to “take significant steps on foreclosure mitigation,” with $50 billion of the funds reserved specifically for that purpose. Such mitigation would have to include a systematic loan modification program, improvements to the Hope for Homeowners program to increase eligibility, and a home buyer’s stimulus plan. The same lack of transparency in the TARP issuance that led Frank to author his proposed legislation similarly led Obama to tell CNBC he wants to see the rest of the TARP money spent wisely, as well as increased oversight and transparency in the Treasury’s role in implementing those funds. He has told CNBC he plans to enforce job creation, increased spending, a fixed economy and reduced taxes when he takes office. It’s still unclear whether any job creation will fall under the revamped TARP or Obama’s forthcoming stimulus plan. In a weekly address Saturday, he reiterated the job creation that will occur under his American Recovery and Reinvestment Plan which he said “will likely save or create three to four million jobs,” by investing in clean energy and government infrastructure projects like repairing schools, roads and bridges. “The jobs we create will be in businesses large and small across a wide range of industries,” Obama said. “And they’ll be the kind of jobs that don’t just put people to work in the short term, but position our economy to lead the world in the long-term.” Write to Diana Golobay at diana.golobay@housingwire.com.

More: