Reps. Gary Miller, R-Calif., and Carolyn McCarthy, D-N.Y., recently introduced H.R. 2140 in the U.S. House of Representatives. The bill offers a comprehensive strategy for reforming the secondary mortgage market and gives the federal government a continued role to ensure a consistent flow of mortgage credit in all markets and all economic conditions.
It would also make it tougher for the Federal Reserve to impose its own capital standards on insurers that are deemed too big to fail.
The Insurance Capital and Accounting Standards Act of 2013 includes provisions for continuing government participation and establishing a new (read: another) government entity to:
- provide liquidity during all market conditions, and thereby
- help ensure qualified home buyers have access to safe and sound mortgage financing products even during market downturns.
The new entity would have no shareholders and “exclusively serve a national mission to facilitate the flow of mortgage capital and provide liquidity during all market conditions,” according to an analysis by the National Association of Realtors. “The proposal also spells out plans to protect taxpayers and ensure safety and soundness through appropriate regulation and underwriting standards.”
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