Bailed-out mortgage giants Fannie Mae and Freddie Mac are a political emergency waiting to happen, a prominent U.S. senator warned Tuesday.

"I still have this fear that we could end up with a down quarter … and all hell broke loose if one of the companies had to go to the government" for a bailout, Sen. Mark Warner said Tuesday at an event on housing finance in Washington.

"I think there would be an enormous outpouring" of voter anger in that scenario, the Virginia Democrat said.

Warner was the author, with Republican Sen. Bob Corker of Tennessee, of a bill to shutter the two mortgage giants and replace them with a system involving private financing for mortgage-backed securities. Their legislation failed to advance in the Senate last Congress, however.

Both senators appeared at an event at the Bipartisan Policy Center Tuesday and acknowledged that legislation to reform or end Fannie and Freddie is not likely during the rest of President Obama's administration.

Warner lamented that the two companies are still not reformed, seven years after they were bailed out by the government in 2008. "This is the last structurally unfixed part of the financial system," he said.

Currently, the two businesses are held in the government's possession, in a legal relationship known as a conservatorship. They have returned to positive cash flow and have sent the Treasury billions of dollars in profits.

In the case of a downturn, however, those remittances to the government could reverse, the senators warned, creating the spectacle of the Treasury again having to support the companies. In that case, Congress would face resentment from voters.

"I can already write the TV ad. Luckily, Corker and I are protected," Warner said, noting their work on the issue. "I think you could see a dramatic reaction."