NAFCU withheld full approval of the housing reform proposal putforward by Republican legislators this week, but found other partsof the bill more favorable.

Representative Jeb Hensarling(R-Texas), chairman of the House Financial Services Committee,joined fellow Republicans to offer the measure Thursday.

The proposal would eliminate Fannie Mae and Freddie Mac,establish a separate non-profit organization to oversee thesecondary mortgage market and sharply limit how many loans receivefederal mortgage insurance.

NAFCU CEO Fred Becker thanked Hensarling for the proposal andnoted that it is good to start the conservation.

“The unveiling of this legislation is an important part of thehousing finance reform debate,” Becker said in a statement. “Still,we have serious concerns about the lack of a government role in thefuture of housing finance in this bill and the impact that omissioncould have on reliable access for credit unions to the secondarymarket.”

But Becker also praised parts of the proposal that echoed someof NAFCU's long-held concerns about federal regulation.

“NAFCU is also encouraged, however, that the discussion draftincludes provisions sought by credit unions to address shortcomingsof mortgage-related rules issued by the Consumer FinancialProtection Bureau,” Becker added.

“These provisions, including key changes to the definition of'points and fees' under the 'ability-to-repay' rule, set to takeeffect in January next year,” he said, “will address unfair andunnecessarily restrictive aspects of the CFPB's rules and helpensure that credit unions can continue to serve the mortgage needsof their 96 million member-owners rather than focus on misguidedregulations that will cause unprecedented compliance and legalburdens.”.

Meanwhile, Rep. MaxineWaters (D-Calif.), ranking member of the House FinancialServices Committee, took a much dimmer view of the proposal, whichshe said was crafted without any cooperation from Democraticlawmakers.

'“I am strongly disappointed in the chairman's legislation,which is little more than an attempt to reinvent America's housingfinance system using the same kind of right-wing ideology that haseroded America's middle class for decade,” Waters said.

“This bill eliminates the 30-year fixed rate mortgage as we knowit and consigns future generations of homeowners to the types ofhigh interest, balloon-payment mortgages that caused the financialcrisis,” she said.

“This is by no means a bipartisan bill. By presenting such anextreme proposal—with no input from Democrats—the chairman standsin stark contrast with his colleagues in the Senate and has made itclear that bipartisan housing finance reform is not his priority,”she said.

A bipartisan bill that also would eliminate the GSEs wasintroduced recently in the upper chamber.