On April 5, the House Financial Services Subcommittee on Capital Markets and Government Sponsored Enterprises (GSEs) marked up eight bills to reform two GSEs, Fannie Mae and Freddie Mac. Each of the bills was passed by the Subcommittee.
The bills would:
- Expand the authority of the inspector general at the Federal Housing Finance Authority, the GSEs’ regulator (H.R. 31).
- Place Fannie Mae and Freddie Mac employees on the federal pay scale (H.R. 3221).
- Require Fannie Mae and Freddie Mac to have higher fees, eventually eliminating their subsidized rates (H.R. 1222).
- Require the GSEs to comply with Dodd-Frank Wall Street Reform Act requirements for institutions that securitize mortgages (H.R. 1223).
- Cap the GSEs’ portfolios (H.R. 1224).
- Prohibit the GSEs from taking on new debt without approval from Treasury (H.R. 1225).
- Eliminate the GSEs’ affordable housing goals (H.R. 1226).
- Prohibit the GSEs from conducting any new business when they are in receivership or conservatorship (H.R. 1227).
Subcommittee Ranking Member Maxine Waters (D-CA) said that the bills represent a scattershot approach and criticized the Subcommittee for marking up eight bills so quickly. Ranking Member Waters also pointed out during the markup that there is a comprehensive GSE reform bill from Representative Jeb Hensarling (R-TX) and asked why this comprehensive bill, H.R. 1182, was not being considered. “We don’t understand how the opposite side is moving,” Ranking Member Waters said.
Financial Services Committee Chair Spencer Bachus noted that up to 16 additional bills on GSE reform could be considered by the Subcommittee.
The Senate Appropriations Subcommittee on Transportation, Housing and Urban Development and Related Agencies held a hearing on April 7, “FHA and the Future of the Housing Market.” HUD Secretary Shaun Donovan was the only witness. Regarding the future of the Federal Housing Administration (FHA), Secretary Donovan said that the Administration’s paper on the future of housing finance envisions a smaller FHA, Fannie Mae and Freddie Mac footprint within the overall housing finance system.
The House Committee on Financial Services intends to hold a hearing, “The Future Role of FHA and GNMA in the Single- and Multi-Family Mortgage Markets.” This hearing has been postponed to a date and time to be announced later.