The scheme to privatize Fannie and Freddie begins

  • Mortgage Bankers Association’s plan would preserve the GSEs
  • Proposal would open door to new competitors in the MBS market

A powerful housing trade group is wasting no time in pushing the Trump administration and Republican-led Congress to address one of the last unresolved issues from the financial crisis, outlining a proposal Tuesday to overhaul mortgage-finance giants Fannie Mae and Freddie Mac.

The Mortgage Bankers Association plan would make Fannie and Freddie privately-owned utilities and cap their returns on capital. It would also turn the government’s implicit backstop of the companies into an explicit guarantee of the mortgage-backed securities they sell to investors.

Read on.

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