Hedge Funds Get Lift on House Bill to Free Fannie, Freddie
- Mortgage giants would be released after 5% capital cushions
- Bill calls for $1 billion put annually in housing trust fund
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Hedge funds seeking to cash in on their shares of Fannie Mae and Freddie Mac may get a boost from U.S. Representative Mick Mulvaney.
The South Carolina Republican is planning to propose legislation by the end of the year that would consider the mortgage giants’ debt to be repaid and release them from conservatorship after they build up capital cushions of 5 percent, according to three people familiar with the bill who asked not to be identified because the details aren’t public. The bill would face a high hurdle to getting passed since it probably won’t receive enough support in the House.