oragator1
02-23-2013, 10:29 PM
A bipartisan panel including former secretaries of the Department of Housing and Urban Development and retired U.S. senators is preparing to release a proposal for scaling back the government role in mortgage finance that would put taxpayer dollars at risk primarily under catastrophic circumstances.
The blueprint, which the Washington-based Bipartisan Policy Center is scheduled to release Feb. 25, is an attempt to jump- start the stalled debate over shrinking the government role in the $9.5 trillion mortgage market, according to three people familiar with the plan. The document was drafted over the past 16 months by a 21-member commission including industry representatives, consumer advocates, and former policy makers.
Enlarge image
The new entity could replace Fannie Mae and Freddie Mac, which were publicly traded companies with no explicit government backing before they were seized in 2008 after investments in risky loans pushed them to the brink of insolvency. Photographer: Andrew Harrer/Bloomberg
The panel will recommend that the U.S. replace Fannie Mae and Freddie Mac, which package loans into securities with guaranteed interest and principal payments, with mortgage-bond guarantees that kick in only after private firms take the initial losses, according to the people, who asked not to be identified because the report isn’t yet published.
http://www.bloomberg.com/news/2013-02-20/limited-mortgage-finance-role-for-u-s-government-gains-support.html
The blueprint, which the Washington-based Bipartisan Policy Center is scheduled to release Feb. 25, is an attempt to jump- start the stalled debate over shrinking the government role in the $9.5 trillion mortgage market, according to three people familiar with the plan. The document was drafted over the past 16 months by a 21-member commission including industry representatives, consumer advocates, and former policy makers.
Enlarge image
The new entity could replace Fannie Mae and Freddie Mac, which were publicly traded companies with no explicit government backing before they were seized in 2008 after investments in risky loans pushed them to the brink of insolvency. Photographer: Andrew Harrer/Bloomberg
The panel will recommend that the U.S. replace Fannie Mae and Freddie Mac, which package loans into securities with guaranteed interest and principal payments, with mortgage-bond guarantees that kick in only after private firms take the initial losses, according to the people, who asked not to be identified because the report isn’t yet published.
http://www.bloomberg.com/news/2013-02-20/limited-mortgage-finance-role-for-u-s-government-gains-support.html