Patrick McHenryChairman

Washington, July 12, 2011 -

WASHINGTON - The Capital Markets and Government Sponsored Enterprises Subcommittee approved legislation today sponsored by Rep. Robert Hurt to reduce the government’s role in the mortgage market.

The Market Transparency and Taxpayer Protection Act directs the Federal Housing Finance Agency (FHFA) Director to require Fannie Mae and Freddie Mac to dispose of all non-mission critical assets.  These reforms go a long way toward reducing the outsized role Fannie and Freddie play in the mortgage market, which was a major cause of the financial crisis in 2008.

Rep. Hurt said, “I was glad to see that the Subcommittee favorably approved H.R. 2440. By enhancing transparency, accountability, and oversight, this bill is another step in our continued efforts to effectively reform Fannie Mae and Freddie Mac and put an end to their near-limitless bailouts in order to protect American taxpayers at a time when they need it most. With more than $150 billion in taxpayer funds already spent propping up Fannie and Freddie and hundreds of billions more a possibility, it is critical that we begin the process of winding down these Government Sponsored Enterprises and increasing the role of the private sector in the secondary mortgage market to strengthen our housing finance system. I look forward to continuing the Committee’s work on this bill as the legislative process moves forward.”

Financial Services Committee Chairman Spencer Bachus said, “Fannie and Freddie continue to report losses and rely on taxpayer dollars in order to continue operating. As a result, they represent the largest taxpayer-funded bailout so far. Selling assets that have nothing to do with the mission of these two companies is critical to protecting taxpayers from wasteful spending, and ensuring that Fannie and Freddie engage only in activities related to their mission.”

Fannie Mae and Freddie Mac were the first two companies to receive a taxpayer bailout. So far, they have drawn on $150 billion in taxpayer support. In 2010, Fannie Mae, Freddie Mac and the Federal Housing Administration guaranteed more than 90 percent of new mortgages.

The legislation was approved by voice vote.

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