The California Association of Realtors this week released a new video, "Fannie and Freddie: Why They Matter to You," in which C.A.R. Executive Vice President Joel Singer explains the often confusing but critical role the government-sponsored entities play in the housing market.
C.A.R., concerned that the critical countercyclical role that Fannie Mae and Freddie Mac are currently playing is often misunderstood or misrepresented, is urging lawmakers to support Fannie Mae and Freddie Mac in their current role, and to urge the U.S. Treasury Department to exercise restraint in its new authority to purchase equity in Fannie and Freddie.
"California’s housing and real estate market is currently in a precarious state," said Singer, a former economist who has held the association’s top staff position since 1989. "…When private lenders have not been able to participate in the market, Fannie and Freddie historically have been there. They’ve been there with affordable mortgages and they’ve also been there with innovative programs, particularly for low-income and first-time buyers."
Singer added that "if Fannie and Freddie were not in the marketplace, we would see a disastrous loss in housing activity. That loss would extend to the economy, and opportunities for home ownership would be very much reduced."
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