Bloomberg-
A bipartisan group of senators is planning to introduce a proposal today for replacing U.S.-owned mortgage financiers Fannie Mae and Freddie Mac (FMCC) with a newly created government reinsurer.
The bill to be offered by Senators Bob Corker and Mark Warner reflects a prevailing view among lawmakers that the two government-sponsored enterprises should cease to exist while a federal role in backing mortgage lending should remain. Corker, a Tennessee Republican, and Warner, a Virginia Democrat, have set a news conference for 2:15 p.m. to introduce the measure.
The senators have revised the proposal from an earlier version to reduce the losses that lenders would take on bad mortgages during a financial crisis, according to a draft copy of the revised 154-page bill that was obtained yesterday.
“There is a bipartisan effort here that’s thoughtful and it is without question the most thorough Congressional effort to draft a GSE reform legislation to date,” David Stevens, president and chief executive officers of the Mortgage Bankers Association, said in an interview.