The potential transition of Fannie Mae and Freddie Mac out of conservatorship raises critical questions about mortgage rates amid government backing. President Trump recently indicated a desire to take these GSEs public while maintaining their implicit government guarantee. This suggests continued support for the GSEs despite market changes. An analysis from the Urban Institute underscores the necessity of government backing, highlighting concerns that the absence of such guarantees could destabilize the housing market and affect mortgage rates significantly if not handled cautiously.
Our great Mortgage Agencies, Fannie Mae and Freddie Mac, provide a vital service to our Nation by helping hardworking Americans reach the American Dream Home Ownership. I am working on TAKING THESE AMAZING COMPANIES PUBLIC, but I want to be clear, the U.S. Government will keep its implicit GUARANTEES.
I've never believed the GSEs could be removed without some form of government backing. The Urban Institute took a look at the issue in this paper published at the start of the year.
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