The bill to wind down Fannie Mae and Freddie Mac, the two government backed mortgage giants that were rescued after the housing market crash in 2008, will be discussed in the senate Tuesday, as officials gather to decide the fate of the two lending firms.
Plans to eliminate Fannie and Freddie have been long-discussed. Several experts joined forces to chalk out strategies to wind down the two firms and boost private lending.
However, the propositions have been widely disputed. Recently in March, Sen. Tim Johnson (D-S.D.), chairman of the Senate Banking Committee, and Sen. Mike Crapo (R-Idaho), a top panelist, announced that they had arrived at certain points and hoped to discuss the bill once it was completely ready.
The committee leaders are now making last-minute alterations to the bill to keep it from stalling and will meet Tuesday to discuss the proposition.
While the White House and The National Association of Realtors are pushing for a quick action on the bill, private investors and civil-rights entities are delaying the process, reports Bloomberg.
"None of us are going to get everything we want. Unfortunately, there are some out there who are working hard to keep this from happening. They're making a lot of money off the old system and doing everything they can to derail reform efforts," Shaun Donovan, secretary of the U.S. Housing and Urban Development told the news site.
But the government is determined to deal with the issue as soon as possible. Referring to Fannie and Freddie as the "last piece of unfinished business" from the financial crisis, Jacob Lew, secretary of Treasury told The Wall Street Journal:
"One shouldn't wait until there's a crisis to deal with this. We ought to deal with it now."
If the bill fails to gather enough votes this time, Fannie and Freddie will probably be restructured rather than eliminated. Dissidents of the whole "wind-down" process believe that any sweeping decisions could affect the growth of the housing market at this time, reports CNBC.
