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Bloomberg: Homebuilders and Realtors Ask Republicans to Delay GSE Bills

April 4, 2011
In The News

By Lorraine Woellert

The National Association of Homebuilders and the National Association of Realtors asked House Republicans to delay a vote on a package of bills to reduce the dominance of Fannie Mae and Freddie Mac.

"The piecemeal approach represented by the eight bills would further damage the already fragile housing market and impede economic recovery," the groups wrote today in a letter to Representatives Scott Garrett, the New Jersey Republican leading the legislative effort, and Maxine Waters, a California Democrat. The trade groups called instead for a "comprehensive plan" to wind down the government-sponsored enterprises.

The House Financial Services capital markets subcommittee, led by Garrett, is scheduled to send the bills to the full committee on Tuesday.

"We're a go for Tuesday," Garrett spokesman Ben Veghte said today.

The measures would wind down the firms in phases as policy makers work on a broader overhaul of the mortgage market. The bills seek to cut the value of the companies' combined $1.5 trillion loan portfolio, raise the fees they charge to guarantee loans and reduce executive compensation.

Representative Jeb Hensarling of Texas is pushing a comprehensive plan to phase out the two companies in five years.

Washington-based Fannie Mae and Freddie Mac of McLean, Virginia, have been relying on a promise of unlimited government aid since 2008, when they were taken under conservatorship amid mounting losses on subprime loans.