The Trump administration issued long-awaited proposals to begin recapitalizing Fannie Mae and Freddie Mac, end the net-worth sweep of the enterprises’ earnings, and ultimately release them from conservatorship.
In reports from the Treasury and Housing and Urban Development departments, the administration recommended maintaining the viability of the enterprises and explicitly defining the secondary mortgage market’s government guarantee.
Treasury also recommended that Congress authorize the Federal Housing Finance Agency to approve and supervise new guarantors to compete with Fannie and Freddie.
ICBA strongly supports ending the net-worth sweep and recapitalizing the enterprises, though it opposes chartering additional guarantors, which could increase the risk of another government bailout and lead to a race to the bottom in underwriting standards. ICBA is reviewing the proposals and will continue working with policymakers on housing-finance reform.
View the Proposals