The Senate Banking Committee passed major legislation to overhaul the housing finance system on Thursday.
The bill by Chairman Tim Johnson, D-S.D., and Sen. Mike Crapo, R-Idaho, the ranking member, drew a final vote of 13-9, after weeks of negotiations to bring more Democrats on board. That effort was unsuccessful, but the legislation still passed with bipartisan support.
The plan to unwind Fannie Mae and Freddie Mac and build a new secondary mortgage market backed by an explicit government guarantee is based on earlier work by Sens. Bob Corker, R-Tenn., and Mark Warner, D-Va., and several other members of the committee.
"After the housing crisis we experienced, real reform is clearly necessary to stabilize the housing system and renew the faith in the American dream of homeownership for generations to come," said Johnson in a press release.
"Even though the support was not unanimous, every member on the committee was actively engaged in this collaborative process, and passing this legislation out of committee is only the first step. I look forward to continue working with my colleagues to keep this important process moving forward."
The legislation passed along with two packages of managers' amendments that included suggested changes by lawmakers, the Obama administration, regulators and others.
Although it cleared committee, the legislation is unlikely to make it to the Senate floor this year as Democratic leadership will be unlikely to bring it up without more support from their side of the political aisle.