Senators Draft Housing Finance Overhaul

New York Times: WASHINGTON — The top Democrat and Republican on the Senate Banking Committee said on Tuesday that they had agreed on a plan to overhaul the nation’s housing finance system and eliminate Fannie Mae and Freddie Mac, the mortgage giants that were bailed out by taxpayers in 2008.

The committee chairman, Tim Johnson, a Democrat from South Dakota, and Mike Crapo of Idaho, the ranking Republican, have come up with a compromise that provides an explicit government guarantee for mortgages, but only after private investors have taken the first losses.

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