Restructuring the U.S. Residential Mortgage Market

There is wide bipartisan agreement that government housing policies, past and present, need to be re-evaluated given their role in the financial crisis. While the reform of Fannie Mae and Freddie Mac was not included in financial reform legislation last year, the Obama administration and congressional leaders are vowing action on these government-sponsored enterprises (GSEs) this year. Will the new majority in the House of Representatives wind down the housing giants and if so, how fast? Can the already weak housing market survive without some kind of an explicit government back-stop? Can consensus be reached?

Read more about the Obama administration’s plan for reforming the U.S. housing market »
View archived video at C-SPAN.com »

On February 11, the Initiative on Business and Public Policy at Brookings hosted a day-long forum to discuss the issues and the options ahead as policymakers discuss the government’s role in the U.S. residential mortgage market. Secretary Timothy Geithner remarked on the administration’s strategy for reforming the nation’s housing finance markets. Former Federal Reserve Chairman Alan Greenspan delivered the keynote address. Four papers written by experts in the housing market and finance field were released and discussed, and two panels tackled the broader issues the papers raise.

Selected papers and presentations are available below, all in PDF format.

Papers

• “Catastrophic Mortgage Insurance and the Reform of Fannie Mae and Freddie Mac,” by Diana Hancock and Wayne Passmore
• “The Government’s Role in the Housing Finance System: Where Do We Go from Here?” by Karen Dynan and Ted Gayer
• “The Economics of Housing Finance Reform: Privatizing, Regulating and Backstopping Mortgage Markets,” by David Scharfstein and Adi Sunderam
• “Toward a Three Tiered Market for U.S. Home Mortgages,” by Robert C. Pozen
• “Eliminating the GSEs as Part of Comprehensive Housing Finance Reform,” by Peter J. Wallison

Presentations

• GSE’s: What are the Options and Issues? by Douglas Elliott
• GSEs: Options and Issues by Edward Pinto
• Catastrophic Mortgage Insurance and the Reform of Fannie Mae and Freddie Mac by Diana Hancock and Wayne Passmore
• Discussion of Hancock and Passmore by Chris Mayer
• Comments on Hancock and Passmore by John Quigley
• The Government’s Role in the Housing Finance System: Where Do We Go From Here? by Karen Dynan and Ted Gayer
• Comments on Dynan and Gayer by Dwight Jaffee
• The Economics of Housing Finance Reform:Privatizing, Regulating and Backstopping Mortgage Markets by David Scharfstein and Adi Sunderam
• Discussion on Scharfstein and Sunderam by Viral V. Acharya
• Three Tiers of Home Mortgages by Robert C. Pozen
• Restructuring the U.S. Residential Mortgage Market by Michael Fratantoni
• Comments on Pozen by Lawrence J. White
• Restructuring the U.S. Residential Mortgage Market by Sarah Rosen Wartell