California AG pushes Fannie, Freddie to reduce principals for delinquent borrowers

New York /
Feb.February 28, 2012 11:30 AM

California Attorney General Kamala Harris is putting pressure on Fannie Mae and Freddie Mac to ramp up their effort to reduce principals for underwater borrowers, the New York Times reports.

In a letter last Friday to Edward DeMarco, the acting director of the Federal Housing Finance Agency, which is the regulator in charge of Fannie and Freddie, Harris asked that foreclosures be suspended until his agency is finished with their review of their current policy, which forbids debt reduction for delinquent homeowners who owe more than their home is worth.

DeMarco has come under increasing pressure since the mortgage settlement deal, was announced. Fannie and Freddie loans, which constitute more than 50 percent of outstanding mortgages in the U.S., are not eligible for relief under the deal.

A FHFA spokesperson said the agency would respond to the letter, and would review incentives available under the Treasury’s new Home Affordable Modification Program, commonly referred to as HAMP. The Times said DeMarco had “left the door open to allowing debt reduction.” [NYT]

 

Related Articles

arrow_forward_ios
Fannie, Freddie to buy mortgages up to nearly $1M
Fannie, Freddie to buy mortgages up to nearly $1M
Fannie, Freddie to buy mortgages up to nearly $1M
(Getty)
Freddie Mac study of 12 million appraisals shows racial disparity
Freddie Mac study of 12 million appraisals shows racial disparity
FHFA director Sandra Thompson (FHFA, iStock)
Treasury suspends investment property restrictions to boost housing supply
Treasury suspends investment property restrictions to boost housing supply
From left: JPMorganChase CEO Jamie Dimon, Goldman Sachs CEO David Solomon and Morgan Stanley CEO James Gorman (Getty)
Demand for private-label mortgages on the rise
Demand for private-label mortgages on the rise
Fannie Mae CEO Hugh Frater (Fannie Mae, iStock)
Fannie Mae to count rent payments toward mortgage approval process
Fannie Mae to count rent payments toward mortgage approval process
Shares of Rocket Cos and LoanDepot rose while shares Fannie Mae and Freddie Mac plunged after Supreme Court ruling (Unsplash)
For mortgage sector stocks, Fannie and Freddie ruling was positive
For mortgage sector stocks, Fannie and Freddie ruling was positive
Mark Calabria and Sandra Thompson (Getty, FHFA)
Biden ousts Fannie, Freddie overseer, leaving them in government’s hands
Biden ousts Fannie, Freddie overseer, leaving them in government’s hands
JPMorgan Chase CEO Jamie Dimon (Getty)
JPMorgan invests in private-label mortgage platform
JPMorgan invests in private-label mortgage platform
arrow_forward_ios

The Deal's newsletters give you the latest scoops, fresh headlines, marketing data, and things to know within the industry.

Loading...