Issue Position: Housing Reform

Issue Position

Senator Warner believes that housing finance is the last piece of unfinished business remaining after the 2008 economic meltdown. With Senator Bob Corker (R-TN), Senator Warner has designed thoughtful reforms that will protect taxpayers from future downturns while responsibly preserving the availability of the 30-year fixed-rate mortgage for homebuyers. The Warner/Corker legislation is co-sponsored by six colleagues on the Senate Banking Committee: Sens. Mike Johanns (R-NE), Jon Tester (D-Mont.) Dean Heller (R-Nev.) Heidi Heitkamp (D-ND), Jerry Moran (R-KS) and Kay Hagan (D-NC).

Housing Finance Reform and Taxpayer Protection Act:

Mandates 10 percent capital, up front, for the system to protect taxpayers against future bailouts.

Winds down Fannie Mae, Freddie Mac and the Federal Housing Finance Agency (FHFA) within five years of bill passage.

Transfers appropriate utility duties and functions to the modernized, streamlined, accountable Federal Mortgage Insurance Corporation (FMIC), modeled in part after the FDIC.

Replaces the failed "housing goals" of the past with a transparent and accountable market access fund that focuses on ensuring there is sufficient affordable housing available for lower and middle-income buyers. The fund is NOT paid for with tax dollars, but through a small FMIC user fee that only those who choose to use the system would pay.

Ensures institutions of all sizes have direct access to the secondary market so that smaller local banks and credit unions are not gobbled up by the megabanks when Fannie and Freddie are dissolved.

Source