Tech & Biz

Obama Considering Splitting Fannie Mae and Freddie Mac

by Amy Judd | August 5, 2009 at 05:42 pm

176 views | 22 Recommendations | 1 comment

According to the Washington Post, President Obama is considering splitting Fannie Mae and Freddie Mac and putting their assests in a federally backed corporation.

The government launched a new set of ideas this week to overhaul the companies, which are the two largest mortgage companies in the United States.

This move would eradicate the hundreds of billions of dollars in home loans that are losing money and are owned by the two companies.

The companies' regulator, James Lockhart, director of the Federal Housing Finance Agency, confirmed that the administration is discussing the "good bank bad bank" model and that the discussion was in an early stage, the Post reported.

The proposal has appeared in several internal papers on the topic and appeared as part of an agenda for a meeting on Thursday hosted by the White House's National Economic Council, the newspaper said.