Toro
Diamond Member
Earlier this year, leading House Republicans proposed privatizing mortgage giants Fannie Mae (FNMA) and Freddie Mac (FMCC) or placing them in receivership starting in two years.
Now, as Republicans prepare to assume control of the House next week, they are offering a more nuanced message: Any retreat of government support in the housing market should be gradual.
"We recognize that some things can be done overnight and other things can't be," said Rep. Scott Garrett, (R., N.J.), incoming chairman of the House Financial Services subcommittee that oversees Fannie and Freddie. "You have to recognize what the impact would be on the fragile housing market as it stands right now."
Cautious statements from key Republicans on the House Financial Services Committee are a shift from the debate over the Dodd-Frank financial overhaul during the spring and summer, when Republicans blasted the Obama administration for leaving Fannie and Freddie out of that legislation.
At the time, Republicans were backing a bill by Rep. Jeb Hensarling, (R., Texas), to cut the government's ties to the mortgage giants, or put them into receivership starting in two years. If they were deemed financially viable under Hensarling's approach, they would be fully private within five years. ...
A hasty end to the government's support of Fannie and Freddie would mean fewer Americans could get home loans, causing home sales and prices to drop even further and making the taxpayer bill for rescuing the mortgage giants even higher, said Rep. Randy Neugebauer (R., Texas), a former banker and housing developer who serves on the House Financial Services Committee.
"You'd cause Freddie and Fannie to have even larger losses than they'd already have," Neugebauer said. ...
"We don't believe that the private market, right now, is willing or able to provide the liquidity that's necessary to get us out of this," said Joe Stanton, chief lobbyist for the National Association of Home Builders.
"To erode that support right now would be a disaster," said Vince Malta, a real-estate agent in San Francisco and a vice president of the National Association of Realtors.
UPDATE: Top House Republicans More Cautious About Fannie, Freddie - WSJ.com
Bloody RINOs, eh?!