SIFMA provides comments to the U.S. Senate Banking, Housing and Urban Affairs Committee responding to questions posed by the Committee on efforts to reform the housing finance system.

SIFMA notes that the Housing Finance Reform and Taxpayer Protection Act of 2013 (S. 1217), provides one blueprint for reform.  Notably, S.1217 would provide some flexibility in its regulatory construction. It would allow for both a guarantor- and securities-based approach to how private capital would support the new conforming loan market, and presumably for a hybrid model approach combining elements of both options. There are many important details that need to be resolved and we strongly support the work of this Committee and Congress to provide that clarity.

SIFMA members believe a critical issue that will require further study and refinement will be the mechanics of exactly how continuity of liquidity will be maintained as we transition the market from the current system to the new system.