US Approves Freddie Mac Pilot Program to Buy Second Mortgages
- Proposal could help households pull equity from their homes
- US households have $32 trillion in real estate equity
Residential homes in Hercules, California.
Photographer: David Paul Morris/BloombergThis article is for subscribers only.
US regulators have authorized a pilot program for housing giant Freddie Mac to buy second mortgages, a shift that could ultimately make it cheaper for households to borrow against the equity in their homes.
The Federal Housing Finance Agency said in a statement Friday that Freddie Mac could buy as much as $2.5 billion of the mortgages over the 18-month trial period. The regulator will then evaluate the program to see if it has benefited borrowers in rural and underserved communities, among other criteria.