WASHINGTON - The regulator overseeing government-controlled mortgage giants Fannie Mae and Freddie Mac has announced a policy that could make more loan money available to borrowers.
Mel Watt, the director of the Federal Housing Finance Agency, said Tuesday in his first public speech that the agency will not reduce current limits on amounts of mortgages that Fannie and Freddie can purchase. The decision was based on concern that a reduction could negatively affect the health of the $10 trillion housing-finance market, he said.
Watt's predecessor, Edward DeMarco, had floated the idea of reducing the maximum loan limits.
The government rescued Fannie and Freddie during the financial crisis in 2008. They received total taxpayer aid of $187 billion, which they have since returned. The companies finance about 60 percent of U.S. mortgages issued.