Supporters are defending a House Republican proposal to liquidate Fannie Mae and Freddie Mac and let the private market fill in the gaps. But despite a nearly complete lack of bipartisan support and even doubts from within his own party, the author of the proposal is pushing hard to fast-track the bill. This week, the House Financial Services Committee heard testimony from 11 experts on the Protecting American Taxpayers and Homeowners Act, introduced last week by Rep. Jeb Hensarling, R-TX.“The PATH Act is a comprehensive proposal to create a sustainable housing finance system by ending the federal government’s domination of the housing finance market and give consumers more choices in determining which mortgage product best suits their needs,” said Hensarling.

Senate Banking Committee Chairman Tim Johnson, D-SD, and Ranking Minority Member Mike Crapo, R-ID, have released a draft FHA solvency bill that is far less ambitious than legislation proposed by House GOP leaders last week. The Senate bill, the FHA Solvency Act of 2013, would essentially shore up the existing FHA program by allowing higher mortgage insurance premiums and requiring a bigger capital buffer. The housing finance reform bill introduced by Rep. Jeb Hensarling, R-TX, chairman of the House Financial Services Committee, would significantly change the FHA program by narrowing its focus and limiting the depth of coverage it provides. The draft Senate bill contains...

The high-stakes game of chicken Congressional Democrats and Republicans have been playing for the better part of the last two years over President Obama’s nomination of Richard Cordray to be director of the Consumer Financial Protection Bureau came to an end this week as GOP members of the Senate blinked first. On Tuesday, the Republicans agreed to allow an up-or-down vote on Cordray to avert a showdown over longstanding filibuster rules in the Senate. Sen. Majority Leader Harry Reid, D-NV, has been threatening to upend the Senate’s traditional filibuster mechanism and change the rule under which presidential nominees must receive 60 votes in order to be approved. Cordray’s nomination to a full five-year term was approved...

Republicans in the House this week detailed their plans for legislation to replace the government-sponsored enterprises with a mortgage securitization system that relies almost entirely on non-agency transactions. The “Protecting American Taxpayers and Homeowners Act” would do away with Fannie Mae and Freddie Mac and eliminate or delay a number of regulatory reforms in an effort to increase non-agency participation in housing finance. “The current system is a government monopoly run by ...

The Republican leadership of the House Financial Services Committee this week unveiled a comprehensive housing finance reform bill, including a series of proposals to “right size” the FHA, redefine its mission and reestablish it as a stand-alone agency. At the same time, Senate Banking Committee Chairman Tim Johnson, D-SD, and Ranking Member Mike Crapo, R-ID, announced they have reached a bipartisan agreement on legislation that would ensure the solvency of the FHA. Both lawmakers expect to introduce a bill next week. The House FHA reform measures were introduced in tandem with reform proposals for ...

New mortgage reform legislation expected soon to be dropped by a senior House Republican is all but certain to go nowhere this year, but having a bill on file and in hand is a necessity in order for GOP hawks to keep their voice in the conversation on government-sponsored enterprise reform, say industry observers. By the end of next week, House Financial Services Committee Chairman Jeb Hensarling, R-TX, will introduce his long-awaited housing reform legislation, sources say. Details of the bill remain sketchy, but it’s to include a complete wind-down of Fannie Mae and Freddie Mac, with only a limited federal support for the mortgage market going forward, most likely housed within the FHA. Hensarling’s legislative effort has been overshadowed...

Sponsors of the highly anticipated, bipartisan Senate legislation intended to reform the mortgage-finance system without Fannie Mae and Freddie Mac unveiled their final proposal last week.But with reform of the FHA more politically urgent and a more radical House bill waiting in the wings, even the Senate bill’s most avid industry supporters don’t expect the measure to gain much political traction in the near term.

Citigroup this week unveiled a $968 million legal settlement with Fannie Mae to cover current “potential future repurchase claims” for breaches of representations and warranties on 3.7 million first liens originated between 2000 and 2012. According to a statement issued by the nation’s sixth largest home lender, almost all of the money that will be paid to the GSE is “covered by Citi's existing mortgage repurchase reserves.”

Legislation filed in the House two weeks ago would require the Treasury Department to once again amend its agreement with Fannie Mae and Freddie Mac to allow the GSEs to pay down the billions of taxpayer dollars the companies received while in government conservatorship.Under the Let the GSEs Pay US Back Act of 2013, H.R. 2435, – sponsored by Rep. Michael Capuano, D-MA – the GSE senior preferred stock purchased by the Treasury would no longer accrue dividends, as is the current practice.

The uphill climb for the Congressman who would be the director of the Federal Housing Finance Agency got a little steeper last week following a lackluster confirmation performance that did not appear to win over Republican critics. Both in his prepared testimony and during questioning by members of the Senate Banking, Housing and Urban Affairs Committee, Rep. Mel Watt, D-NC, placed a heavy emphasis on his biographical details, but he was light on mortgage-finance policy specifics. Republicans pressed hard on his technical qualifications for the job of FHFA director. “The Housing and Economic Recovery Act clearly defines...