Mortgage

Castro: Broad support for ending Fannie Mae and Freddie Mac

Will it be a priority in the administration’s final two years?

While the complete overhaul of the government-sponsored enterprises has continuously been an issue in Washington, it has not always been a top priority.

After the Federal Housing Administration released its actuarial report on the Mutual Mortgage Insurance Fund for single-family programs on Monday, Secretary of Housing and Urban Development Julian Castro reiterated that housing reform will continue to be a priority. Per Bloomberg:

Peter Cook with Bloomberg asked Castro:

What do you see as your main priorities right now in terms of trying to lift the housing recovery further, and what role are Fannie and Freddie going to play in this? Obviously there’s a lot of talk about overhauling them, doing away with Fannie and Freddie. Is that going to be a priority for this administration in the final two years?

In response Castro said:

Housing finance reform certainly has been a priority and will continue to be a priority. As your viewers know, this has been an issue with a lot of attention over the last year or so. There was a bipartisan piece of legislation, Johnson-Crapo, that made it out of the Senate Banking Committee. There are others, Senators Corker and Warner, as well as folks in the House who have been working on this issue.

(Click here for the top 10 critical issues facing GSE reform)

This could be I believe a good victory either in the lame duck session or more realistically perhaps in the next term of Congress where there is bipartisan support for – for housing finance reform, for doing away with Fannie and Freddie as we’ve known them, creating a backstop. However, introducing more private capital into the market and taking the taxpayers off the hook if we do ever experience what we just went through as part of the housing crisis in 2007, 2008, 2009, that is a priority this administration and for HUD.

In contrast, Stanley Street, in an exclusive interview with HousingWire, expressed his belief that GSE reform was not going to be a priority in the coming months, but that Congress would likely focus on changing the Consumer Financial Protection Bureau.

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