February 22, 2012
The Wall Street Journal
WASHINGTON – The U.S. is studying a single way to package home loans into securities as an interim step toward a system that could outlive Fannie Mae and Freddie Mac, mortgage-finance firms that have faced an uncertain future in the wake of the housing market's bust.
The Federal Housing Finance Agency, the federal regulator for Fannie and Freddie, on Tuesday said it is looking at the development of a system that could take the place of the proprietary ones of both companies.
The housing agency disclosed its thinking in a new 21-page strategic plan for Fannie and Freddie sent to Congress. Congress and the Obama administration have taken few steps toward deciding the fate of the housing giants. The Obama administration, meanwhile, has only offered broad outlines of potential recommendations.
Earlier this month, Treasury Secretary Timothy Geithner pledged to lay out more detail on the administration's approaches to reforming the US housing finance system this spring. A Treasury spokesman didn't immediately comment on Tuesday.
The housing regulator, facing a lack of consensus about the future of the two mortgage giants, said it wanted to move forward on interim steps that could make the ultimate unwinding of Fannie and Freddie easier. At the same time, the FHFA said it wanted to keep all options open about how much support the government should provide to the $10.3 trillion US mortgage market.
Fannie and Freddie operated for decades as independent and competitive firms. They have been collaborating on certain issues, such as providing assistance to troubled homeowners, since they were put under federal control in September 2008.
To read more on this story, see The Wall St. Journal article here.
SOURCE: FOX NEWS
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