Is It Time To Shut Down Fannie Mae and Freddie Mac?
Fannie Mae and Freddie Mac have been government backed far too long.
They have already cost the taxpayers $187 Billion in their bailout.
There are members of Congress who are calling for the phasing out of Fannie and Freddie. They are saying that the private sector should be the ones involved with mortgage loans for homebuyers. I agree. And surprisingly, President Obama agrees.
President Obama said: “For too long, these companies were allowed to make huge profits buying mortgages, knowing that if their bets went bad, taxpayers would be left holding the bag,” Obama said of Fannie and Freddie. “Private capital should take a bigger role in the mortgage market — I know that sounds confusing to folks who call me a socialist.”
Of course many in the mortgage industry and I am sure that special interest groups in the housing industry are not in agreement. Even though we are in the business of real estate there are principles that are more important to us than our special interests. The main principle of free markets and free enterprise is paramount to a healthy economic environment. I vote first as an American before I vote as a REALTOR®.
Many people on both sides of the isle agree that the mortgage industry should be in the hands of the private sector and that government should not be involved with making loans or guaranteeing mortgage loans and that Freddie and Fannie expose great risk to taxpayers.
Last month a bill was passed that would end Fannie Mae and Freddie Mac. A committee spokesman from Congress said Tuesday that their bill would end “the largest bailout in history”, This would also phase out the government’s role in housing finance, thereby giving consumers more choices when shopping for mortgage products.
It is time for Fannie and Freddie to be phased out over the next five years.