Reform, Interrupted

For a moment in the spring when the Johnson-Crapo bill moved, GSE reform may have seemed, finally, possible. Many in the industry now agree, however, that the likelihood of any action has come to a halt.

CPE_1114_Finance480x270What’s Next for the GSEs?

By Keat Foong, Finance Editor

For a moment in the spring when the Johnson-Crapo bill moved, GSE reform may have seemed, finally, possible. Many in the industry now agree, however, that the likelihood of any action has come to a halt.

“There is a very small chance of getting GSE reform in the next year,” observed Willy Walker, chairman, president & CEO of Walker & Dunlop. “My take is that regardless of whether the Senate is won by Republicans or Democrats, there will be limited interest either in drafting new GSE reform legislation or getting Johnson-Crapo legislation back up and going.”

The industry-supported, bipartisan Johnson-Crapo bill (S. 1217) in the Senate, which builds on the GSE reform bill introduced in 2013 by Sens. Bob Corker (R-Tenn.) and Mark Warner (D-Va.), was passed by the Banking Committee in May. The bill would wind down Fannie Mae and Freddie Mac, create a government backstop for guarantee of mortgage securities, and allow the private sector to take over much of the GSEs’ current functions.

Read the full article in the November 2014 issue of CPE. Access is free!