With federal interest swelling regarding the privatization of Fannie Mae and Freddie Mac, Reps. Tom Suozzi and Nicole Malliotakis have introduced a bipartisan bill calling for the federal government to dedicate as much as $250 billion received from ending the conservatorship of Fannie and Freddie to be invested in the construction of up to affordable housing.
Under the Housing for U.S. Act, union labor would be contracted to build up to 3.5 million housing units, dedicated specifically for middle-class Americans. After 10 years, the remaining funds would be used for deficit reduction.
The Housing for U.S. Act calls for the creation of a federally backed, low-cost loan program that will:
- Build new housing units across the country.
- Serve working families earning up to 150% of Area Median Income (AMI)—more than $210,000 per year for a family of four in high-cost areas like New York City.
- Prioritize ownership and affordability for teachers, nurses, first responders, tradespeople, and other Americans who power U.S. communities.
“If Fannie and Freddie are released, the government could recoup $250 billion,” said Rep. Suozzi. “We should capitalize on this moment by using these funds to build homes for men, women, and families in the American middle-class, and we should pay union workers to do it. It’s good for the economy, good for families, and good for America.”
Fannie Mae and Freddie Mac, the government-sponsored enterprises (GSEs), help provide stability and affordability to America’s home mortgage market. The National Association of Realtors (NAR) reports that Fannie and Freddie support approximately 70% of the U.S. mortgage market.
On September 6, 2008, with consent of both Fannie Mae’s and Freddie Mac’s Boards of Directors, the Director of the Federal Housing Finance Agency (FHFA) exercised statutory authority to place each GSE into conservatorship. This move established the two conservatorships in response to a deterioration in the housing markets that severely damaged the financial condition of each, and left both of them unable to fulfill their missions without government intervention.
“I join Rep. Suozzi in introducing bipartisan legislation that, should Fannie Mae and Freddie Mac be released from conservatorship, would assign the proceeds toward a new housing revolving loan fund to expand homeownership and rental opportunities for working- and middle-class Americans including police officers, firefighters, teachers, carpenters, and tilers who often earn too much to qualify for affordable housing but not enough to afford market rates,” said Rep. Malliotakis. “This is a chance to deliver critical assistance to hard working Americans.”
In late May, President Donald Trump took to social media outlet TruthSocial, making his intentions known on the long-discussed privatization of Fannie Mae and Freddie Mac.
“I am giving very serious consideration to bringing Fannie Mae and Freddie Mac public,” said President Trump via social media. “I will be speaking with Treasury Secretary Scott Bessent, Secretary of Commerce Howard Lutnick, and the Director of the Federal Housing Finance Agency, among others, and will be making a decision in the near future. Fannie Mae and Freddie Mac are doing very well, throwing off a lot of CASH, and the time would seem to be right. Stay Tuned!!”
The Housing for U.S. Act is supported by a wide coalition that includes the Firefighters Association Local 94, the Teamsters Local 282, and the National Urban League.
Gary LaBarbera, President of the Building and Construction Trades Council of Greater New York, added: “The introduction of the Housing for US Act is a unique, bipartisan collaboration that can trigger affordable housing development reserved for this population, while also creating countless family-sustaining union careers that will generate key economic stimulus and boost our local communities for generations to come. Let’s free Fannie and Freddie and use the proceeds to build homes for American workers by American workers.”
Rep. Scott Fitzgerald took to social media to support President Trump’s intentions to bring the GSEs public.
“The GSE conservatorship has gone on for far too long. I agree with President Trump that the government should sell its stake in Fannie Mae and Freddie Mac to bring in more private capital. The funds can be used to pay for middle-class housing,” said Rep. Fitzgerald via his Facebook account.
“We have a once-in-a-generation chance to tackle America’s housing crisis while creating good-paying, union jobs for working families,” Rep. Suozzi continued. “The housing crisis is crushing the American Dream—young people, carpenters, cops, teachers, nurses, first responders, and middle-class families are being priced out of homeownership. This isn’t a red state or blue state issue—every community is feeling it. And that’s why I’m proud to introduce this legislation with my fellow New Yorker from across the aisle. When we work together, we can get things done.”
The post Bill Would Channel Billions From Fannie/Freddie Sale Towards Affordable Housing first appeared on The MortgagePoint.
