In reaction to President Obama's remarks in Arizona regarding housing finance reform Tuesday, U.S. Senator Bob Corker, a member of the Senate Banking, Housing and Urban Affairs Committee, told the Southern Middle Tennessee Association of Realtors at a meeting in Columbia he is finally seeing momentum to move a structural housing finance reform bill that ends the Fannie and Freddie model of private gains and public losses.
“There is real momentum growing to finally move a structural housing finance reform bill that ends the Fannie and Freddie model of private gains and public losses, and I look forward to working with my colleagues in the Senate, the House and the White House to see it through,” said Senator Corker.
In June, Senator Corker, Senator Mark Warner, D-Va., and a bipartisan group of senators introduced the “Housing Finance Reform and Taxpayer Protection Act” to strengthen America’s housing finance system by replacing government-sponsored enterprises (GSEs) Fannie Mae and Freddie Mac with a privately capitalized system that preserves the availability of desirable mortgage products to creditworthy borrowers and fully protects taxpayers from future economic downturns.
The Corker-Warner bill, which has drawn broad support from stakeholders and industry experts, includes the following:
· Mandates 10 percent capital, up front, for the system to protect taxpayers against future bailouts.
· Winds down Fannie Mae, Freddie Mac and the Federal Housing Finance Agency (FHFA) within five years of bill passage.
· Transfers appropriate utility duties and functions to the modernized, streamlined and accountable Federal Mortgage Insurance Corporation (FMIC), modeled in part after the FDIC.
· Replaces the failed “housing goals” of the past with a transparent and accountable market access fund that focuses on ensuring there is sufficient decent housing available. The fund is NOT paid for with tax dollars, but through a small FMIC user fee that only those who choose to use the system pay.
· Ensures institutions of all sizes have direct access to the secondary market so local banks and credit unions aren’t gobbled up by the mega banks when Fannie and Freddie are dissolved.
Later Tuesday Senator Corker will discuss his bill with the Middle Tennessee Association of Home Builders at an event in Brentwood. On Wednesday, he will meet with the Sumner County Association of Realtors in Hendersonville and community bankers in Lebanon.
For more information on the Housing Finance Reform and Taxpayer Protection Act (S. 1217) click here
Press Release: Banking Committee Senators Introduce Legislation to Modernize and Reform America's Broken Housing Finance System
Banking Committee Senators Garner Broad Support for Bipartisan Housing Finance Reform Bill
Bill Text: Housing Finance Reform and Taxpayer Protection Act
Summary of Legislation: Housing Finance Reform and Taxpayer Protection Act
Press Release: Corker Statement on House Financial Services Committee Plan to Reform Housing Finance System, Wind Down Fannie and Freddie