Podcast Center
Video Center
Webcasts
Resource Center
Events
July 20, 2008 at 04:00 PM
Efforts to shore up Fannie Mae and Freddie Mac announced by the Bush administration along with a separate Federal Reserve announcement to assist the entities, could be taken up in a housing bill before Congress.
Both entities were created to provide greater access to affordable housing and have been hit hard by the sub-prime mortgage crisis.
The bill being considered will also impact life insurers.
Sale of insurance products by originators of reverse mortgages backed by the government would effectively be barred under a provision of housing legislation passed by the Senate that life insurance industry officials are trying to soften.
The provision is contained in Sec. 2122 of the Senate version of H.R. 3221. The bill passed the Senate July 11.
The House language, which is more acceptable to life insurers, is in Sec. 219 of the bill, which has the same number.
That is because, under federal legislative procedure, one chamber takes a bill sent to it by the other chamber, strips it and inserts its own language. In general, through a House-Senate conference or private talks, the two bills are reconciled.
A similar provision in the House version of the legislation is far less restrictive and acceptable to the industry, according to Maurice Perkins, a vice president of federal relations at the American Council of Life Insurers.
“We don’t oppose anti-tying provisions, meaning that sale of one product is tied to another,” Perkins said. “But what we have here is something entirely different. This is basically a blanket prohibition.”
