Should Fannie and Freddie Fund Housing for the Poor?
The Affordable Housing Trust Fund is empty because shortly after Congress set it up in 2008, the companies that were supposed to fund it -- Fannie Mae and Freddie Mac -- were seized by the government.
“We saw that Fannie and Freddie were both coming back, in fact roaring back, and all this money was going to the federal Treasury and there was just no justification for not putting aside some of that money, which at this point is so small compared to the amount that has gone to the Treasury,” said Charles Elsesser, a Florida legal aid lawyer who filed the suit on behalf of the National Low Income Housing Coalition.
Now that the mortgage financiers are posting record profits, it’s time to reverse that decision, a group of 33 U.S. senators wrote in a January letter to Melvin L. Watt
Fourteen Republican senators sent Watt a letter yesterday asking him not to allow contributions to the trust fund. “If Watt is going to fulfill promises he made during the confirmation process to protect taxpayers, he will continue the common sense suspension of contributions
Then Today 12/11/14!
WASHINGTON, Dec 11,2014 (Reuters) - Fannie Mae and Freddie Mac's regulator on Thursday directed the two government-controlled mortgage firms to begin setting aside money for an affordable housing fund established in 2008.
Federal Housing Finance Agency Director Mel Watt said in letters to the two firms that it was appropriate to roll back a suspension of payments into the fund given their return to financial health.
This will eliminate some law suits against the FHFA.
This will be hard to reverse now. 3% down is IN, affordable housing is IN, Mortgage principal reduction is IN. The only thing left is Release from conservatorship.
By doing all these controversial things before the new congress can work on Housing the FHFA has predetermined the route to take, by trying to write these out of the new law, the law will not pass. There is NO WAY to keep these things in policy as DEMOCRATS want, without risking turning FHFA and treasury over to Republicans in 2 years and have it all reversed.
THERE IS ONLY ONE WAY, RELEASE FROM CONSERVATORSHIP. It is the only way.