Senate Bill Seeks to Wind Down Fannie Mae in Five Years

Fannie Mae and Freddie Mac would continue paying all of their profits to the Treasury for the next five years under bipartisan Senate legislation designed to wind down the U.S.-owned mortgage financiers and overhaul the government’s role in the housing market.

A draft of the measure, released yesterday by Senate Banking Committee Chairman Tim Johnson and Republican Mike Crapo, would ensure the U.S. maximizes its return on the 2008 taxpayer bailout of the two companies before junior preferred and common shareholders receive any proceeds.