Monday, August 13, 2007

Fannie Mae & Freddie Mac Plan Rejected

Fannie Mae & Freddie Mac, who hold or guarantee a combined two-thirds of all U.S. home mortgages, have been denied a request to take on more debt. The Office of Federal Housing Enterprise Oversight refused their requests to relax investment caps. The move was seen as a way to provide liquidity in the market for mortgage-backed securities. But the OFHEO argued that the risk of allowing the two companies to take on more debt was too great.

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