House panel chief plans May vote on Fannie Freddie

Reuters News
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Posted: Mar 31, 2011 4:35 PM

WASHINGTON (Reuters) - The House Financial Services Committee plans to vote in early May on a bill to wind-down Fannie Mae and Freddie Mac within five years, Representative Spencer Bachus, the panel's chair, said on Thursday.

That move would mark another shift in strategy among House Republicans about what to do with the two largest providers of funding for the $10.6 trillion U.S. residential mortgage market.

House Republicans earlier this week introduced a series of more targeted measures aimed at reducing the influence of the two firms without shutting them down entirely.

"We may let the other bills catch up ... but there is no reason not to vote on the comprehensive bill," Bachus told Reuters.

The comprehensive bill refers to legislation introduced by Texas Representative Jeb Hensarling, the fourth highest ranking Republican in the House of Representatives, that would shut the two firms down within five years.

The series of narrowly crafted bills unveiled earlier this week is designed to garner broader support than would likely be won with more sweeping legislation to shut down the government-controlled firms, particularly in the Democrat-led Senate.

Representative Scott Garrett, the New Jersey Republican who heads the subcommittee overseeing Fannie Mae and Freddie Mac, is leading the charge for the more targeted approach.

Included in the basket of bills are measures that would speed up the wind-down of the mortgage portfolios held by Fannie Mae and Freddie Mac, eliminate their affordable housing goals and raise the fees they charge to guarantee mortgages in an effort to make private capital more attractive.

Garrett has scheduled an April 5 vote in the subcommittee on his suite of bills, but the full committee would vote on Hensarling's bill first, sometime after lawmakers return from Easter recess in early May, Bachus said.

The full committee, then the full House and the Senate would have to approve any measure before it could be sent to President Barack Obama for his signature into law.

(Reporting by Corbett B. Daly)