GSEs may net nearly $180 billion for government
Sen. Tim Johnson (above) is working with Sen. Mike Crapo on a reform plan.
March 11, 2014 – A new analysis shows Fannie Mae and Freddie Mac paying the federal government nearly $180 billion over the next decade, according to a report on The Hill’s On the Money blog.
The report says the two entities, which have received an aggregate $187 billion in federal advances since they were conserved, are expected to have paid the government more than $200 billion by the end of this March. The report makes clear this is not money in the form of a repayment but is a separate pool of funds for the government.
The analysis is based on a look at White House budget projections that show both Fannie and Freddie remaining in operation and paying dividends to the government through 2024. It also says private investors have filed suit to challenge the agreement under which they are sending all profits to the federal government.
Senate Banking Committee Chairman Tim Johnson, D-S.D., and Ranking Member Mike Crapo, R-Idaho, are currently working on a draft housing finance reform plan that is expected to address the future of Fannie and Freddie. Reports say the two are close to releasing an outline of their proposal, which could come as early as this week.
NAFCU is monitoring progress on housing finance reform legislation and working to ensure that any final reform measure includes government-guaranteed access for credit unions to the secondary mortgage market and loan pricing based on loan quality, not quantity.
The Hill's On the Money blog post
Housing finance reform