Obama: Won't Change Fannie and Freddie Without Legislation

Paul Stewart, SAMCAR Government Affairs Director | December 2, 2014

President Obama stated he will not end government control of mortgage-finance companies Fannie Mae and Freddie Mac without legislation. (Fannie Mae and Freddie Mac are Government-Sponsored Enterprises, or, GSEs). The edict was stated by the Treasury Department. In the announcement the President said, "Comprehensive housing finance reform legislation is the only way to end the conservatorship responsibly and transition to a new system that brings stability back to the housing market while protecting taxpayers." The federal government has been working since 2008 to replace Fannie Mae and Freddie Mac with some schemes calling for an immediate end to the GSEs while others recommending a five to seven year phased change. Nothing has been finalized yet.

SAMCAR—in concert with NAR—has recommend that Fannie Mae and Freddie Mac be replaced by a non-shareholder owned authority(s) that is subject to tighter regulations on product, revenue generation and usage, and retained portfolio practices in a way that ensures the mission of the GSEs continues to meet the needs of consumers and that the taxpayer is protected. Moreover, we have recommended the entity(s) be managed in such a way as to encourage private capital's participation in the secondary mortgage market.

TAGGED: Fannie Mae, Freddie Mac, President Obama

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