Sen. Wayne Allard, R-Colo., is working on a legislative proposal to increase competition in the secondary market dominated by Fannie Mae and Freddie Mac with an eye toward attaching it to a bill Congress is working on to strengthen regulation of the government-sponsored enterprises."The senator is listening to all the positive proposals we are getting and trying to decide which is the wisest course," spokeswoman Angela de Rocha told MortgageWire. Several years ago, Sen. Allard sponsored a bill that would allow Ginnie Mae to guarantee securitizations of conventional loans. Currently Ginnie Mae only guarantees government-backed loans, such as loans insured by the Federal Housing Administration. Ginnie does not compete in the conventional market with Fannie and Freddie. This year, the Mortgage Bankers Association and the National Association of Home Builders are pushing a proposal that would allow the Federal Home Loan Banks to issue and guarantee mortgage-backed securities. Sen. Allard, who chairs the housing subcommittee, hasn't endorsed any proposal yet. "They are at the very beginning of the process," Ms. de Rocha said.
