While the Obama administration continues to consider options for the future of housing finance, two mainstream media outlets reported Tuesday that the administration is looking into a plan that would retain major government involvement in the future housing market.[IMAGE]
Particularly in response to the ""_Washington Post's_ article"":http://www.washingtonpost.com/business/economy/on-mortgage-rates-government-should-keep-significant-role-obama-says/2011/08/15/gIQA8wP0HJ_story.html?wpisrc=al_national stating, ""President Obama has directed a small team of advisers to develop a proposal that would keep the government playing a major role in the nation's mortgage market,"" ""Treasury"":http://www.treasury.gov/Pages/treasury-for-text-view.aspx issued a release negating these reports.
""The Obama Administration believes that private sector Ã¢â‚¬" subject to strong oversight and consumer protection Ã¢â‚¬" should be the dominant provider of mortgage credit,"" Treasury stated.
In a February report to Congress, Treasury and HUD proposed three options for housing finance reform, and each included a major decrease in government involvement in the market.[COLUMN_BREAK]
""[A]ny government support for housing finance will be targeted and limited,"" the Treasury stated in its release Tuesday.
""_Bloomberg_"":http://www.bloomberg.com/news/2011-08-16/fannie-and-freddie-would-survive-in-new-form-under-obama-plan.html received a similar statement from White House spokesperson, Matt Vogel, who told the news agency, ""We remain committed to winding down Fannie and Freddie, though such significant measures would need to be done gradually and with care.""
While Fannie Mae and Freddie Mac currently play a prominent role in ""providing support to a still-fragile housing market,"" Treasury maintains that in each of the three proposals being considered ""Fannie Mae and Freddie Mac will be wound down on a responsible timeline.""
Additionally, Treasury stated that, contrary to statements in the media, the administration has not yet selected a single proposal for housing finance reform.
The White House housing finance reform team, the Treasury Department, and HUD are continuing to review the administration's report to Congress, according to Treasury.
""Today, our focus must be on both healing a still-struggling housing market and taking the steps necessary to bring private capital back into the housing market,"" Treasury stated.
""The principles we have laid out will help lead to a future system with more private capital, more oversight, and less risk to the taxpayer Ã¢â‚¬" in short, to a healthier, more stable system of housing finance,"" Treasury concluded in its statement Tuesday.