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Bill would replace Fannie and Freddie

Thu, Jul 7, 2011

News

A bill expected to be introduced in the U.S. House Financial Services Committee today would create a new government-run agency to replace Fannie Mae and Freddie Mac.

Gary Miller, a California republican, and Carloyn McCarthy, a New York democrat told media they plan to introduce the legislation today that would eliminate the two government-backed private agencies with one government program.

The bill has been endorsed by the National Association of Realtors and the National Association of Homebuilders.

While the legislation is popular with housing industry advocates, it’s a dramatic departure from previous legislation that has proposed eliminating the two agencies that guarantee home mortgages with government money in efforts to protect tax payers from the liability.

House republican leaders support eliminating the two agencies and selling off their debt to private financial institutions in order to eliminate risk to tax payers.

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