Pursuits
Fannie-Freddie Plan Would Create Utilities, Add Competitors
- Trade group’s proposal could require $200 billion in capital
- Government would continue to back mortgage-backed securities
Aerial views of suburban sprawl in New Jersey, U.S., on Wednesday, June 10, 2015.
Photographer: Craig Warga/BloombergThis article is for subscribers only.
Fannie Mae and Freddie Mac would be turned into shareholder-owned utilities and face competition from new companies under a trade group’s mortgage-finance overhaul plan that could eventually require about $200 billion in private capital.
The Mortgage Bankers Association proposal released Thursday calls for the U.S. government to remain involved in the housing market, putting its guarantee behind mortgage-backed securities that the firms issue but no longer backstopping the companies themselves.