I 
110TH CONGRESS 
2D SESSION 
H. R. 7094 
To establish a term certain for the conservatorships of Fannie Mae and 
Freddie Mac, to provide conditions for continued operation of such enter-
prises, and to provide for the wind down of such operations and the 
dissolution of such enterprises. 
IN THE HOUSE OF REPRESENTATIVES 
SEPTEMBER 25, 2008 
Mr. HENSARLING (for himself, Mr. GARRETT of New Jersey, Mr. FLAKE, Mr. 
PENCE, Mr. SALI, Mr. BROUN of Georgia, Mr. TANCREDO, Mr. GINGREY, 
Mr. SULLIVAN, Mr. LAMBORN, Mr. WALBERG, Mr. JORDAN of Ohio, Mr. 
GOHMERT, and Mr. BURTON of Indiana) introduced the following bill; 
which was referred to the Committee on Financial Services 
A BILL 
To establish a term certain for the conservatorships of 
Fannie Mae and Freddie Mac, to provide conditions for 
continued operation of such enterprises, and to provide 
for the wind down of such operations and the dissolution 
of such enterprises. 
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled, 
SECTION 1. SHORT TITLE. 
This Act may be cited as the ‘‘Government-Sponsored 
Enterprises Free Market Reform Act of 2008’’. 
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SEC. 2. DEFINITIONS. 
For purposes of this Act, the following definitions 
shall apply: 
(1) CHARTER.—The term ‘‘charter’’ means— 
(A) with respect to the Federal National 
Mortgage Association, the Federal National 
Mortgage Association Charter Act (12 U.S.C. 
1716 et seq.); and 
(B) with respect to the Federal Home 
Loan Mortgage Corporation, the Federal Home 
Loan Mortgage Corporation Act (12 U.S.C. 
1451 et seq.). 
(2) DIRECTOR.—The term ‘‘Director’’ means 
the Director of the Federal Housing Finance Agency 
(3) 
ENTERPRISE.—The 
term 
‘‘enterprise’’ 
means— 
(A) the Federal National Mortgage Asso-
ciation; and 
(B) the Federal Home Loan Mortgage 
Corporation. 
(4) 
GUARANTEE.—The 
term 
‘‘guarantee’’ 
means, with respect to an enterprise, the credit sup-
port of the enterprise that is provided by the Fed-
eral Government through its charter as a govern-
ment-sponsored enterprise. 
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SEC. 3. TERMINATION OF CURRENT CONSERVATORSHIP. 
(a) IN GENERAL.—Upon the expiration of the period 
referred to in subsection (b), the Director of the Federal 
Housing Finance Agency shall determine, with respect to 
each enterprise, if the enterprise is financially viable at 
that time and— 
(1) if the Director determines that the enter-
prise is financially viable, immediately take all ac-
tions necessary to terminate the conservatorship for 
each of the enterprises; or 
(2) if the Director determines that the enter-
prise is not financially viable, immediately appoint 
the Federal Housing Finance Agency as receiver 
under section 1367 of the Federal Housing Enter-
prises Financial Safety and Soundness Act of 1992 
and carry out such receivership under the authority 
of such section. 
(b) TIMING.—The period referred to in this sub-
section is, with respect to an enterprise— 
(1) except as provided in paragraph (2), the 24- 
month beginning upon the date of the enactment of 
this Act; or 
(2) if the Director determines before the expira-
tion of the period referred to in paragraph (1) that 
the financial markets would be adversely affected 
without the extension of such period under this 
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paragraph with respect to that enterprise, the 30- 
month period beginning upon the date of the enact-
ment of this Act. 
(c) FINANCIAL VIABILITY.—The Director may not 
determine that an enterprise is financially viable for pur-
poses of subsection (a) if the Director determines that any 
of the conditions for receivership set forth in paragraph 
(3) or (4) of section 1367(a) of the Federal Housing En-
terprises Financial Safety and Soundness Act of 1992 (12 
U.S.C. 4617(a)) exists at the time with respect to the en-
terprise. 
SEC. 4. LIMITATION OF ENTERPRISE AUTHORITY UPON 
EMERGENCE FROM CONSERVATORSHIP. 
(a) REVISED AUTHORITY.—Upon the expiration of 
the period referred to in section 3(b), if the Director 
makes the determination under section 3(a)(1), the fol-
lowing provisions shall take effect: 
(1) PORTFOLIO
LIMITATIONS.—Subtitle B of 
title XIII of the Housing and Community Develop-
ment Act of 1992 (12 U.S.C. 4611 et seq.) is 
amended by adding at the end the following new sec-
tion: 
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