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The 30-year, fixed-rate mortgage could become a thing of the past if the federal government no longer has a significant role in housing finance, NAFCU witness John Fenton, president and CEO of Affinity FCU, will tell the Senate Banking Committee this morning.

"Without a government role in the secondary market, the 30-year [fixed-rate mortgage] may still exist, but likely with higher cost to the consumer and scarce availability," Fenton says in prepared remarks for today's hearing. "The system of long-term, fixed-rate mortgages financed through stable securitization has helped provide remarkable stability in the U.S. economy, as well as strong and sustainable ownership."

The NAFCU-member Affinity FCU, located in Basking, N.J., offers 10-, 15-, 20- and 30-year mortgage loans to its members. Fenton says the 30-year loan, which makes up 48 percent of the credit union's outstanding mortgages, is the most popular among his members because it is the most affordable. Since credit unions cannot raise funds from the capital markets, the government-sponsored enterprises – Fannie Mae and Freddie Mac – fulfill an essential role in ensuring credit unions have access to mortgage liquidity, he says.

Today's Senate Banking hearing on housing finance reform will focus specifically on the 30-year, fixed-rate mortgage. The hearing is at 10 a.m., and Fenton is the only credit unionrepresentative testifying.

NAFCU is continuing to press its core principles that it wants addressed in connection with any reform of the housing finance system. Among these is the preservation of credit unions' continued access to mortgage liquidity, including through the secondary market. Another is ensuring, regardless of what happens with Fannie Mae and Freddie Mac, the existence of at least two government-sponsored enterprises going forward to preserve that availability.

Other witnesses in today's hearing includePaul Willen, senior economist and policy advisor for the Federal Reserve Bank of Boston; Janis Bowdler, deputy director of the Wealth Building Policy Project of the National Council of La Raza; Anthony Sanders, a finance professor at George Mason University School of Management; and Susan Woodward, president of Sand Hill Econometrics.