Housing Chief says Housing Finance Overhaul requires Caution
After the worst economic crisis since 1920's and the tsunami of foreclosures, the Fed took control of Fannie Mae and Freddie Mac and directed more than $125 billion for them to purchase mortgages from lenders. But the housing market is still very fragile...
Last Wednesday, April 14, 2010, Housing and Urban Development Secretary Shaun Donovan stated that suddenly changing the structure of the Federal Fannie Mae and Freddie Mac mortgage programs would be likely to lower home prices but could threaten the fragile U.S. economic recovery at the same time.
Donovan’s statement came as the Obama administration has started debating a complete overhaul of the government’s role in housing finance, including the fate of Fannie Mae and Freddie Mac.