report this week
that shutting down Fannie and Freddie would save the government billions had MPA readers up in arms. The Congressional Budget Office report said that the government could reduce direct spending by $60 billion over 10 years by dismantling Fannie and Freddie and replacing them with a new federal mortgage insurer.
Sen. Bob Corker (R-Tenn.), who’s co-sponsoring a bill that would do just that, said dismantling Fannie and Freddie in favor of a new insurer would be a “win-win” for taxpayers. MPA readers, however, weren’t so sure.
“Bob Corker should put a cork in it,” said reader Cheryl M.”Talk about what you know, not what you don't.”
“Eliminating Fannie Mae and Freddie Mac will increase the cost and the rate for consumers who are qualified and have strong credit,” said reader Edward. “I have not seen anything done right by the government!! Right now the Treasury is profiting from Fannie and Freddie in billions and they are not costing the government anything!”
“Where do they come up with this stuff?” asked reader Junior. “They have been collecting dividends for years, where's that money? During the TARP bailout they received dividends and TARP was repaid. Where is that money? There is already a government sponsored mortgage entity called FHA
. To get rid of Fannie and Freddie would just raise the costs to consumers...again.”
And MPA forum poster had just one question:
“Replace FNMA and Freddie with what? No one has a practical answer to this question. Creating a void in home financing will cause a depression.”
What do you think? Is the bipartisan fervor to dismantle Fannie and Freddie misguided? Or is it time for the government to get out of the mortgage business altogether? Let us know your thoughts in the comments below.