House Dems introduce bill to replace Fannie, Freddie

by Adam Smith11 Jul 2014
A trio of House Democrats have introduced a bill to overhaul housing finance.

According to The Hill, Reps. John Delaney (Md.), John Carney (Del.), and Jim Himes (Conn.), introduced a bill that would wind down Fannie Mae and Freddie Mac and replace them with a new private capital system. The Partnership to Strengthen Homeownership Act would provide a government guarantee for mortgages, but would require a minimum of 5 percent private capital support. The remaining 95% of the risk would be shared through an insurance program established through Ginnie Mae and a private reinsurer, The Hill reported.

“We aren’t the first group to try to find a solution to reforming our housing finance system, but we think our proposal has promise because it strikes the necessary balance between public- and private-sector involvement in the housing market," Carney said.

Senate Banking Committee member Sen. Bob Corker (R-Tenn.) applauded the legistlation, praising the lawmakers for their "thoughtful and productive contribution of this important issue".

The National Association of Realtors also spoke in support of the legislation.

“The efforts that you have undertaken reflect a methodical, measured and comprehensive approach that is based on practical application and not just academic theory,” NAR president Steve Brown said.


  • by nope | 7/11/2014 9:36:52 AM

    It is not completely broken ,but when our lawmakers get through with it ,it will be. Examples of Government failure, IRS , post office, Social security, Obama care Medicare, Border security.

  • by Charles Stidham | 7/11/2014 10:26:17 AM

    Dear dazed and confused lawmakers,

    NEWSFLASH; Fannie Mae and Freddie mac are posting record profits and the foreclosure rate for mortgages originated and closed from 1/1/12 to present is less then 1%. Please stop trying to make yourselves look good by introducing lame and inept legislation for a problem that has already been solved. Get a life and pay attention.

  • by sbharkness | 7/11/2014 11:10:47 AM

    Here we go again! Big Government sticking there legislative noses into a problem that has already been resolved. FNMA & FHLMC are posting record profits. In addition the quality of the mortgages used to back the bond issuance's have never been higher. These things are gone through with a fine tooth comb not only for compliance but also sale-ability.

    Things were working with the system perfectly for decades when government under then President Bill, "Home-ownership is a right" Clinton decided to deregulate the banking industry. This had everything to do with several of his cronies being able to make mega fortunes than it did to do with allowing American's to buy homes! Again, just as we are starting to see some light at the end of the tunnel, here come three Congressman that probably couldn't spell the word "Mortgage" between them. They certainly could not explain how a mortgage becomes securitized, then used for collateral for bond sales, but they don't have to understand. What they do understand is dollars and how many will be funneled into their coffers by the lobbyist asking for these supposed reforms. We so need to get private money, and the corruption it brings out of big government.


Is TILA-RESPA a good or bad thing long term?