WASHINGTON — Rep. Edward Royce, R-Calif., a long-time friend to credit unions, urged fellow House members Wednesday to support a Senate proposal that would make significant reforms to Fannie Mae and Freddie Mac.
Legislation, which is principally focused on regulatory relief, recently approved by the Senate Banking Committee would require Fannie and Freddie to conduct more securitizations involving risk-sharing with private investors.
The GSE reform proposals, which Royce said could pass Congress and be signed into law this year, would also speed up the development of the common securitization platform along with making it accessible to private issuers of mortgage-backed securities.
Some have called it "stealth GSE reform," Royce said at the National Journal housing finance event.
The two proposals, he said, would increase "private sector participation in the secondary housing market and decrease taxpayer exposures to losses."
As a senior member of the House Financial Services Committee, Rep. Royce said he will work with Chairman Jeb Hensarling, R-Texas, to pass similar proposals in the House.
"A common securitization platform and increased risk sharing are achievable policy objectives for this Congress that sets the stage for future reform," Royce said.