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Regulator rejects Obama's plan to aid homeowners
The sale of foreclosed homes has helped banks and mortgage-lenders still trying to recover from the housing crisis.
The sale of foreclosed homes has helped banks and mortgage-lenders still trying to recover from the housing crisis.
CC BY: Jeff Turner
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n Tuesday, the regulator of Fannie Mae and Freddie Mac, the government-owned mortgage companies, rejected President Obama's plan to reduce the mortgages of struggling homeowners, saying the move would encourage homeowners to default and make a negligible impact on the moribund housing market. The plan had been strongly supported by the Obama administration and Democrats in Congress, in a bid to help homeowners who ended up owing more than their houses were worth in the aftermath of the recession. Obama's plan would have reduced the loan principal of certain mortgages backed by Fannie Mae and Freddie Mac, and White House officials say the companies' regulator, Edward DeMarco, is wrong in his assessment.

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