The Treasury Department released a plan Thursday aimed at overhauling the U.S. housing market. A key component of the plan has the government relinquishing control over Fannie Mae and Freddie Mac in order to privatize the mortgage buyers.
Fannie Mae and Freddie Mac, which back half of the country's mortgages, have been under government conservatorship since the 2008 financial crisis. Under the Trump administration plan, Freddie Mac and Fannie Mae would be privatized again and required to pay a fee for government protection. This approach does not require any approval from Congress, and the plan doesn't detail what will happen to the government's stakes in the firms or how they will build their capital up enough so they can go private again, The Washington Post reports.
Housing prices continue to rise across the country, and Treasury Secretary Steven Mnuchin said the proposal "will protect taxpayers and help Americans who want to buy a home." Sen. Sherrod Brown (D-Ohio) disagrees, telling the Post that the plan "will make mortgages more expensive and harder to get. I'm urging the president: Make it easier for working people to buy or rent their homes, not harder."
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