Tag Archives: GSE

Fairholme Funds, one of the largest GSE investors, sued the government in 2013 for sweeping of GSE profits into the U.S. Department of Treasury and recently noted that "a “common sense solution" will prevail.

On an Investors Unite Conference call Wednesday, Isaac said while in the midst of the 2008 financial crisis the government used Fannie and Freddie to stabilize housing finance, the government’s current actions could cause another, potentially worse, crisis.

The bill, introduced by Rep. Marsha Blackburn (R-Tennessee), seeks to “amend the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to establish a secondary reserve fund for a housing enterprise under conservatorship to protect taxpayers against loss in the event of a housing downturn, and for other purposes."

Rep. John K. Delaney (Maryland), Rep. John Carney (Delaware), and Rep. Congressman Jim Himes (Connecticut) said the bill would wind down Fannie Mae and Freddie Mac and allows the GSEs to be sold and recapitalized. The congressmen said protecting the 30-year fixed rate mortgage is key because it ensures “home affordability for the middle class and shields American taxpayers from future bailouts by reforming the housing finance system.”

According to the letter, the senators feel the CSP should have an “open architecture” that gives access to private industry and does not limit the CSP to been an appendage to GSEs. Opening the CSP will “enhance the ability for small and mid-sized lenders to access the secondary mortgage market and facilitate greater competition in this market going forward,” the letter said.

AEI's National Mortgage Risk Index (NMRI), released monthly through the institute's International Center on Housing Risk, registered 11.87 percent for May, down from April's revised reading. The institute considers any index value below 6 percent as "indicative of conditions conducive to a stable market." The index acts as a stress test, measuring the percentage of loans at risk of default in the event of another economic crisis.