Chapter 1: Freddie Mac Maintains a Strong Public Focus Charter provisions ensure a singular focus on providing a stable supply of low-cost mortgage funds.
Chapter 2: Freddie Mac Addresses Systemic Weaknesses in Housing Finance Before the creation of Freddie Mac, credit shortages and regional disparities persistently plagued the conventional mortgage market.
Chapter 3: Freddie Mac Provides Substantial Public Benefits Freddie Mac lowers mortgage rates, saving homeowners billions of dollars every year, and brings stability to the nation’s housing and financial markets.
Chapter 4: Freddie Mac Benefits the Public at No Public Cost Freddie Mac’s safe and sound operations ensure continued benefits to homeowners and renters at no cost to the government or taxpayers.
Chapter 5: Charter Repeal Would Increase Taxpayer Risk Because government involvement in mortgage markets is multifaceted, charter repeal would shift more mortgage business to government agencies and federally insured depositories.
Chapter 6: Charter Repeal Would Magnify Jumbo Market Weaknesses Following charter repeal, all conventional borrowers would be subject to the higher and more variable mortgage rates characteristic of today’s jumbo market.
Chapter 7: Charter Repeal Would Hurt Families Mortgage rates would rise and the availability of conventional, low-down-payment, fixed-rate loans would fall, reducing homeownership.
Chapter 8: Freddie Mac Serves Enduring Public Purposes Freddie Mac’s functions are still necessary and appropriate to ensure that mortgage money is always available to finance America’s housing.
1. Federal Housing Enterprises Financial Safety and Soundness Act of 1992 Sec. 1355 (106 Stat. 3672 (1992) (current version at 12 U.S.C. Sec. 4602 (1994)) (FHEFSSA). In directing the four agencies (the General Accounting Office, the Congressional Budget Office and the Departments of Treasury and Housing and Urban Development) to evaluate the "desirability and feasibility" of these steps, Congress posed six specific questions for the agencies to answer and also directed the agencies to evaluate any other factors bearing on the desirability and feasibility of "privatization." The six specific issues are evidence of Congress’ concerns with the effects of "such privatization" on: 1) applicable federal law requirements and the cost to the enterprises, 2) the enterprises’ cost of capital, 3) housing affordability and availability and the cost of homeownership, 4) the level of competition in the secondary mortgage market, 5) the capital requirements of the enterprises and 6) the secondary market for residential loans and their liquidity.