Fannie Mae, Freddie Mac May Forgive Principal On Mortgages
Officials at Fannie Mae and Freddie Mac, the government-sponsored enterprises taken into conservatorship in September 2008, may change their position on the use of forgiving principal as a foreclosure prevention tool, USA Today reports.
The Federal Housing Finance Agency, which regulates Fannie Mae and Freddie Mac, may decide later this month, said Edward DeMarco, director of the FHFA while speaking Tuesday at the Brookings Institution.
A recent study found the mortgage giants, which guarantee about 60 percent of all mortgages, could save $1.7 billion if they forgave principal on some distressed mortgages.
Phoenix Business Journal