By Shaila DeWan | The New York Times
Yet another proposal for winding down Fannie Mae and Freddie Mac and overhauling the nation’s housing finance system will be put before Congress on Thursday, this one by Representative Maxine Waters of California, the ranking Democratic member of the Financial Services Committee.
The major distinction of Ms. Waters’s proposal is that it would make the mortgage lending system more like a public utility, by creating a co-op of lenders that would be the sole issuer of mortgage-backed securities guaranteed by the government. Such a system would significantly differ from those proposed by the major bills in the Senate, which would allow banks and bond guarantors to participate independently in the market. Both Ms. Waters’s proposal and the Senate ones would establish a new federal regulator.
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