Waters Unveils Housing Finance Reform Legislation

Press Release

Today, Congresswoman Maxine Waters, Ranking Member of the Financial Services Committee, released a comprehensive legislative proposal to reform the housing finance market. Known as the Housing Opportunities Move the Economy (HOME) Forward Act of 2014, the legislation ends Fannie Mae and Freddie Mac, and creates a new, cooperative-owned securities issuer.

For months, Waters has been working with her Committee colleagues, outside stakeholders, and consumer and affordable housing advocates to craft a measure that ends the incentives created by the ownership structure of the government-sponsored enterprises' (GSEs) while preserving the role of small financial institutions, providing a more flexible approach to placing credit risk in the markets, and ensuring access to affordable rental housing for low-income families.

"Reforming a 10 trillion dollar housing finance market is an immense undertaking that must be carefully considered," said Congresswoman Waters. "Fannie Mae and Freddie Mac's return to profitability and repayment of taxpayer dollars has led some to rightly speculate whether the enterprises need any reform at all. I believe that we have an opportunity to address some of the fundamental flaws of the current system, by ending the perverse incentives created by Fannie Mae and Freddie Mac's ownership structure and providing an explicit government guarantee that is paid for by industry."

The draft bill furthers a conversation started by legislation released by Senators Bob Corker (R-TN) and Mark Warner (D-VA) and, more recently, Senators Tim Johnson (D-SD) and Mike Crapo
(R-ID).

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