Wait…BUT Internal Documents Show Fannie Mae Believed Principal Reduction Would Save Taxpayers Money
Bloomberg-
Fannie Mae (FNMA) and Freddie Mac won’t forgive principal on delinquent mortgages they guarantee even as the U.S. Treasury Department is offering incentive payments for writedowns, the companies’ regulator said today.
Months of analysis showed there would be no clear benefit to taxpayers if the Federal Housing Finance Agency were to change its longstanding policy barring the government-owned mortgage-finance companies from loan modifications that include debt writedowns, Edward J. DeMarco, the agency’s acting director, said today said at a briefing with reporters.
“We concluded the potential benefit was too small and uncertain relative to unknown costs and risks,” DeMarco said.