The U.S. Senate has approved bipartisan legislation that would help strengthen the ailing housing market by providing the Department of Treasury explicit authority to extend credit to Fannie Mae and Freddie Mac, reforming the Federal Housing Administration, and strengthening federal oversight of the mortgage industry.
Senator Collins voted in support of the legislation and released this statement:
“This housing legislation is not perfect. But it is the result of extensive, bipartisan negotiations and recognizes how crucial the housing sector is to our overall economy. Millions of families throughout the nation are struggling economically because of the cost of both energy and the sharp downturn in the housing market, and many have experienced or are facing foreclosure on their homes.
"Fannie Mae and Freddie Mac are crucial components of our national policy that promotes home ownership. They hold or guarantee more than $5 trillion in mortgages, and their mortgage purchases allow local banks to recycle funds to help new home buyers. A financial collapse of these organizations would be very detrimental to our overall economy as well as to homeowners.
“I agree with many financial experts that federal loans or capital infusions into these companies should have protections for taxpayers and that taxpayers should not be asked to bail out private stockholders who voluntarily bought shares in these entities. I also believe, however, that the bill does not contain enough safeguards to avoid a future replay of irregularities and excessive risk-taking by Fannie Mae and Freddie Mac. Stronger federal oversight of these federally chartered yet investor-owned corporations is warranted.
“Our national mortgage finance structure needs further reform to safeguard both borrowers and the financial system to prevent a repeat of our current housing crisis.
“On balance though, it is important for this bill to move forward without further delay.”