Now that everyone has had a few days to look over the Crapo-Johnson proposal to replace Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) with a new federal agency, analysts are starting to predict what impact it will have on the mortgage market and the broader economy, assuming it has any impact at all.

Fannie Mae Freddie Mac FHFA Federal National Mortgage Assctn Fnni Me (FNMA)

“The White House has expressed a desire for a bipartisan bill to serve as a reference point for the 114th Congress next January, rather than starting Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) reform from the ground up,” write Raymond James analysts Buck Horne and Paul D. Puryear in a March 19 report. “As Congress prepares for mid-term elections, we believe meaningful Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) reform legislation will make little progress this year. Assuming the newly created Johnson-Crapo bill moves through the Senate this year, it will likely meet its demise once it reaches the Republican-majority House.”

Crapo-Johnson has some bipartisan support

It’s easy to point to deadlock as a reason why any particular bill won’t get passed, and there’s no reason to expect speedy passage for this one, but the Crapo-Johnson proposal already has bipartisan support like the Corker-Warner plan that it is largely based on. Unlike the previous plan, it doesn’t take a position on what should be done to settle disputes with Fannie Mae / Federal National Mortgage Assctn Fnni Me (OTCBB:FNMA) and Freddie Mac / Federal Home Loan Mortgage Corp (OTCBB:FMCC) preferred shareholders, which should at least soften the opposition of hedge funds, pension funds, and other influential investors.

Conservatives may see FMIC as preferable to Fannie, Freddie

Many conservatives would rather see the government get out of the mortgage market altogether, and the creation of an entirely new government agency is sure to draw criticism, which Horne and Puryear were probably taking into account when they predicted that the proposal won’t gain traction. But if the only options are between the creation of the Federal Mortgage Insurance Corp. (FMIC) or the current arrangement, they might decide that it’s better to have a layer of private businesses and reinsurance insulating taxpayers from having to immediately bail out the mortgage market than the setup we currently have in place.

If the Raymond James analysts are correct that President Obama is looking for something that he can work with next January after the mid-terms elections have come and gone, this will also take the immediate pressure off legislators worried that a vote for or against the proposal making them look bad. For better or worse, there is more momentum behind the Crapo-Johnson proposal than anything else we’ve seen thus far.