It's been an interesting topic going back to 2009 and today, legislation was introduced by Republican Representative Gary Miller of California and Democratic Representative Carolyn McCarthy of New York to merge Fannie Mae and Freddie Mac. This would create a single entity allowing the government held organization to collectively purchase mortgages and sell them to investors as government backed securities.
The new entity would seemingly operate in a not-for-profit setup, creating a “secondary market facility” for residential mortgage loans. Secondary Market Operations is no news to us however the idea is ... Operating costs would be supported by buying home loans and then pooling them into bonds sales which would generate income. All realized profits would be returned to the U.S. Treasury. Banks would pay a “guarantee” fee on loans which would also serve to financially support the new entity. The plan claims to address severe losses by requiring investors to pay a fee to finance an insurance fund.
Read the full story here: http://agentgenius.com/real-estate-mortgage-economy/bill-introduced-to-merge-fannie-mae-freddie-mac-realistic/
Rep. Miller said, “we don’t want Congress meddling,” so the bill notes the new operation would be governed by a presidentially appointed board.
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