Two bills have emerged as dueling proposals to reform the GSEs: the Housing Finance Reform and Taxpayer Reform Act (the “Corker-Warner Bill”) in the Senate, and the Protecting American Taxpayers and Homeowners Act of 2013 (“PATH Act”) in the House. The key thrust of both bills is to protect taxpayers from absorbing losses in the secondary mortgage market. Although the bills remain in committee as t hey gain traction in both chambers, any final legislation will likely have features of each proposal. A high-level summary of the bills follows.

The Corker-Warner Bill -

Federal Mortgage Insurance Corporation (“FMIC”): Modeled after the FDIC, this agency would replace the GSEs within 5 years. The FMIC would provide a catastrophic guarantee to investors through the mortgage insurance fund it would administer.