During the housing finance sector's collapse, private capital withdrew from mortgage markets having a significant, competing role with the GSEs. What does this mean for my business?įannie Mae and Freddie Mac play a key role in the secondary mortgage market, which is crucial in providing capital for mortgage lending. FHFA explained it took this action “to help restore confidence in Fannie Mae and Freddie Mac, enhance their capacity to fulfill their mission, and mitigate the systemic risk that has contributed directly to the instability in the current market.” The conservatorship continues today. On September 7, 2008, the Federal Housing Finance Agency (FHFA) placed Fannie Mae and Freddie Mac (the government sponsored enterprises, or GSEs) into conservatorship. Read NAR's Vision for Housing Finance Reform. FHFA, the regulator overseeing the GSEs, continues to look at ways of reforming Fannie and Freddie while providing mortgage financing to a broad population while protecting taxpayers from unnecessary risk. Congress continues to debate reforms to the GSEs and the conservatorship model, though the near-term chance of reform remains low. This would severely restrict, if not curtail, home sales and any supporting ancillary home sales services.įannie and Freddie continue to support around 70% of the mortgage market and remain a vital component of the housing finance system. Without the government’s support of the GSEs and FHA-insured loans, which currently constitutes a large portion of the market space, there would be almost no capital available for mortgage lending.
During the housing finance sector's collapse, private capital withdrew from having a significant, competing role with the GSEs. Fannie Mae and Freddie Mac (the government-sponsored enterprises or GSEs) play a key role in the secondary mortgage market, which is crucial in providing capital for mortgage lending.
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