Dive Brief:
-
A congressional effort to dissolve Fannie Mae and Freddie Mac and let private entities take over their functions has stalled.
-
The bill, introduced by Senate Banking Committee Chairman Tim Johnson, R-SD, and Mike Crapo, R-ID, was passed by the committee in May, and would overhaul the housing finance industry. The authors contend the legislation would save taxpayers $58 billion over a decade.
-
The legislation piggybacks on another bill that would create a new government reinsurer, the Federal Mortgage Insurance Corp., which would use insurance premiums and fees on secured loans to insure mortgage-backed securities.
Dive Insight:
Washington insiders don’t expect the bill to reach the Senate floor for a vote before Johnson retires at the end of the year, leaving the proposal to a newly elected Congress to decide.