On Tuesday, the Senate Committee on Banking, Housing, and Urban Affairs hold a hearing on GSE Reform, after the Treasury Department has released its plan to reform the housing finance system.
According to the department, the Treasury Housing Reform Plan consists of a series of recommended legislative administrative reforms aimed to “protect American taxpayers against future bailouts,” preserve the 30-year-fixed-rate mortgage, and help guide Americans toward the path to homeownership.
“The Trump Administration is committed to promoting much needed reforms to the housing finance system that will protect taxpayers and help Americans who want to buy a home,” said U.S. Treasury Secretary Steven T. Mnuchin in a release by the department. “An effective and efficient Federal housing finance system will also meaningfully contribute to the continued economic growth under this Administration.”
Fannie Mae and Freddie Mac suffered significant losses due to their structural flaws and lack of sufficient oversight during the financial crisis of 2008. The GSEs received more than $190 billion from the Treasury Department.
Fannie Mae issued the following statement: "We are reviewing today’s announcement. We appreciate the Administration putting forward a housing finance reform plan. As always, we are committed to being as helpful as possible to policymakers as they consider the future of the GSEs and housing finance. We remain focused on providing market liquidity, serving our customers, and addressing America’s housing needs.”
President Donald Trump issued a Presidential Memorandum on March 27, 2019, directing the Secretary of the Treasury to develop a plan to address the “last unfinished business of the financial crisis.”
“As a direct result of the Trump Administration’s pro-growth policies, unemployment is at 50-year low and American families are earning higher incomes and enjoying more opportunities than seemed possible just a few years ago,” said Secretary of Housing and Urban Development Ben Carson in a release. “There is still one piece of unfinished business from the financial crisis: housing finance reform. These changes to our housing finance system will help more American families achieve their dream of owning a home.”
Here's what's happening in the Week Ahead:
DS News Webinar (Sep. 12)
Banking Committee Hearing (Sep. 12)