Federal Housing Finance Agency (FHFA) Director Mark Calabria addressed the future of Fannie Mae and Freddie Mac at the recent National Association of Realtors (NAR) Regulatory Issues Forum.
Fannie Mae and Freddie Mac became government-sponsored entities (GSE) following the financial crisis and despite returning to profitability years ago, the two remain under government control. Advocates in favor of releasing Fannie Mae and Freddie Mac from conservator-ship believe private ownership leads to a more competitive mortgage market. Those who oppose worry we will see a repeat of the financial crisis, especially if the proper precautions are not taken.
Mark Calabria says the GSE's are not yet ready and this would destabilize the secondary market for mortgage backed securities. President Trump and US Secretary of the Treasury Steve Mnuchin have yet to speak about a plan for the future.
I believe that Fannie Mae and Freddie Mac should return to private for profit companies. There is a great argument for combining them into one entity. I predict that pressure from NAR, Banks and the market in general will change
