Banks Down, Fannie and Freddie to Go
With Sen. Chris Dodd (D-Conn.) on the cusp of pushing his financial regulatory reform bill through Congress, the head of the Senate Banking Committee is looking
Jul 31, 202087.2K Shares1.6M Views
With Sen. Chris Dodd (D-Conn.) on the cusp of pushing his financial regulatory reform bill through Congress, the head of the Senate Banking Committee is looking forward to the next legislative fight, over housing and mortgage finance. This morning, Dodd said that the government-sponsored enterprises — Fannie Mae, Freddie Mac and the federal home-loan banks, which lost hundreds of billions of dollars in the housing bust and own or guarantee more than half of U.S. mortgages — need a major reform bill as well.
In response to a question about the GSEs, Dodd saidthey are in “desperate need of reform” this morning. “But candidly there’s only so much I could only take on with this bill and so that comes up. But not in this round. It’s in the next wave here we have to deal with GSEs.”
To this end, last week the Treasury Department releaseda list of seven questions Washington will try to address with housing and mortgage finance reform. It is seeking the advice of housing market professionals and others, and asked the public to write in answers and attend town hall meetings on the subject this summer as well. The questions are:
- How should federal housing finance objectives be prioritized in the context of the broader objectives of housing policy?
- What role should the federal government play in supporting a stable, well-functioning housing finance system and what risks, if any, should the federal government bear in meeting its housing finance objectives?
- Should the government approach differ across different segments of the market, and if so, how?
- How should the current organization of the housing finance system be improved?
- How should the housing finance system support sound market practices?
- What is the best way for the housing finance system to help ensure consumers are protected from unfair, abusive or deceptive practices?
- Do housing finance systems in other countries offer insights that can help inform U.S. reform choices?
Rhyley Carney
Reviewer
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