House Approves Bill to Boost Home Ownership
Special Consideration to Be Given to Gulf Coast Residents Left Homeless by Hurricanes

October 26, 2005

WASHINGTON, DC - Congressman David Dreier (R-San Dimas, CA), Chairman of the House Rules Committee, voted today to approve legislation that will help more Americans achieve the American dream of owning their own home and strengthen oversight of federally supported housing programs. The Federal Housing Finance Reform Act of 2005, H.R. 1461, was approved with bipartisan support, 331-90.

"Home ownership in America is currently at an all time high," Dreier said. "We need to take steps to continue that very positive trend across the country. At the same time, we have millions of fellow Americans who have lost their homes to Hurricanes Katrina and Rita. They need help now. This legislation addresses both of these concerns. We place special emphasis on aiding the residents of the Gulf Coast who need new homes, and provide stronger regulations for the Government Sponsored Enterprises that will help them secure new housing."

The Federal Housing Finance Reform Act, H.R. 1461, creates a new regulator for the housing Government Sponsored Enterprises (GSEs) in response to recent accounting violations and corporate mismanagement. The housing GSEs, Fannie Mae, Freddie Mac, and the Federal Home Loan Banks, are among the largest U.S. financial institutions, with $2.5 trillion in assets. The legislation establishes a new independent regulator, the Federal Housing Finance Agency (FHFA) to oversee Fannie Mae, Freddie Mac and the Federal Home Loan Banks. The FHFA will have enhanced regulatory power to ensure the safety and soundness of GSEs. It also establishes an affordable housing fund modeled on the successful Federal Home Loan Bank affordable housing program. This fund will finance construction of housing for underserved people. Fannie Mae and Freddie Mac will each contribute a fixed percentage of after-tax earnings to the fund (3.5 percent for the first two years and 5 percent in following years.) For the first two years of this program, additional weight will be given to areas impacted by Hurricanes Katrina and Rita.