Industry News

Freddie, Fannie say Congress trying to have it both ways

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Fannie Mae and Freddie Mac will be in a better position to help housing markets weather the current turmoil in subprime lending if Congress doesn't give regulators free rein to decide how much debt they can safely take on, executives with the companies told lawmakers Thursday. The government-sponsored entities, which purchase mortgage loans from lenders and guarantee loans that sold to Wall Street investors on the secondary market, have been fighting tighter limits on their lending portfolios, which currently total $1.4 trillion. In the wake of accounting and managements scandals at the GSEs, Bush administration officials and other Republican lawmakers have warned that Fannie and Freddie's considerable debt obligations pose a "systemic risk" to the banking system and financial markets. The GSEs also have critics on the other side of the aisle, with some Democrats and affordable-housing advocates saying they've been more focused on profits than the mission Congress created them for -- ...