Baker Backs New Plan For Freddie, Fannie

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A new regulatory scheme to oversee the secondary mortgage market and specifically its two biggest players, Fannie Mae and Freddie Mac, will almost certainly include the Federal Home Loan Bank System, a growing source of mortgage funding for credit unions.

Rep. Richard Baker (R-LA), chairman of the House Financial Services Subcommittee on Government Sponsored Enterprises, told The Credit Union Journal last week he will introduce a bill soon to create a new regulator for Fannie and Freddie, which will also include the FHLBs.

The 12 regional banks have become increasingly important to the secondary market since the advent of their own programs to buy mortgages from their bank and credit union members.

But the programs have caused some financial difficulties at some of the regional banks, prompting calls for a replacement of their chief regulator, known as the Federal Housing Finance Board. Baker said the proposal he will introduce will recognize the differences between the so-called GSEs, Fannie, Freddie and the FHLBs, and will call for separate offices within a same agency.

The Baker bill is expected to be introduced soon after the Easter recess for Congress.

Ed Roberts can be contacted at eroberts cujournal.com.

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