Faced with the prospect of the White House moving unilaterally to end government control of Fannie Mae and Freddie Mac, Senate Banking Chairman Mike Crapo laid down a marker Friday with his own plan to overhaul the nation's housing finance system.
Crapo (R-Idaho) offered the three-page outline with little notice Friday morning in the wake of comments by a top housing regulator suggesting that the Trump administration would go it alone on reforming the system — a goal that has remained elusive since the two mortgage giants were seized during the 2008 financial crisis.
Fannie and Freddie, which dominate mortgage financing, would become private guarantors whose market share would be capped under the plan. They would be required to sell off their multifamily businesses. No mortgage guarantor would be allowed to offer discounts to issuers based on volume, and banks would not be permitted to become guarantors.
“We must expeditiously fix our flawed housing finance system,” Crapo said in an emailed statement. “My priorities are to establish stronger levels of taxpayer protection, preserve the 30-year fixed rate mortgage, increase competition among mortgage guarantors, and promote access to affordable housing.
Read more in Politico.