The road to reforming Fannie, Freddie
Here's a look at some of the major events the mortgage financing giants faced when things began to unravel in the housing market in 2007.
For years the federal government
has been trying to figure out what
to do with Fannie Mae and Freddie Mac.
May 22 | Months after the nation's mortgage delinquency rate reached a four-year high in the fourth quarter of 2006, the House clears legislation that would toughen oversight of the mortgage financing giants. |
Nov. 19 2007 | Fannie Mae and Freddic Mac share prices sink to 10-year lows on concerns about mortgage defaults. |
March 19 | The Office of Federal Housing Enterprise Oversight clears Fannie Mae and Freddie Mac to buy more mortgages to help the housing market. The move reduces the amount of capital the two mortgage financing companies have to set aside to protect them against losses. |
July 30 2008 | President George W. Bush enacts a law that gives the administration temporary authority to offer an unlimited line of credit to Fannie Mae and Freddie Mac. |
Sept. 7 2008 | The U.S. seizes control of the mortgage-finance giants to help quell unrest in the housing and financial markets. Freddie Mac leader Richard Syron is replaced by David Moffett. Fannie Mae chief executive David Mudd is pushed out as former Merrill Lynch Vice chair Herbert Allison steps in. |
Nov. 10 2008 | Fannie Mae reports a loss of $29 billion for the quarter -- the biggest loss among U.S. companies this year. Fannie cites the rescue’s shortcomings. |
Nov. 25 2008 | The federal government announces new loan programs that will use up to $800 billion to revive consumer lending. The move expands the government's intervention in the financial system. |
Feb. 18 2009 | The federal government doubles the monetary support for Freddie Mac and Fannie Mae to $400 billion to cover losses on mortgage-related investments. |
Feb. 26 2009 | Fannie Mae reports a loss of $59 billion in 2008, prompting the Treasury to give it $15 billion. |
April 20 2009 | Fannie Mae names Michael J. Williams, the company’s chief operating officer, as its new CEO. Williams replaces Allison whom the Obama administration tapped to run Treasury’s financial recovery program. |
July 21 2009 | Freddie Mac names Charles Haldeman as its new CEO. Haldeman worked in the financial industry for many years. He is the fourth person to hold job since the federal takeover. |
August 7 | Freddie Mac reports a profit. |
Dec. 24 2009 | The Obama administration pledges unlimited financial assistance to Fannie Mae and Freddie Mac, allowing the government to exceed the $400 billion cap on emergency aid without seeking permission from a bailout-weary Congress. |
March 5 2010 | Barney Frank (D-Mass.), chairman of the House Financial Service Committee, warns of investing in Freddie Mac and Fannie Mae. In response, the Treasury reaffirms its committment to help the companies. |
March 23 | Treasury Secretary Timothy F. Geithner tells a congressional panel that the Obama administration backs reforming the mortgage giants and would keep the parts of the housing system that worked well. |
May 11 2010 | Democrats defeat a GOP push to end the government’s control of the mortgage financing giants. |
July 27 2010 | The administration announces a conference to start a public discussion on how to reshape the housing-financing system. |
Feb. 11 2011 | The Obama administration proposes raising fees for borrowers and requiring large down payments for home loans as part of a long-term effort to reduce the government's outsized footprint in the housing market. |
SOURCES: Washington Post, staff reports
