Wednesday, February 27, 2008
Cap for Fannie and Freddie lifted
-- U.S. regulators for Fannie Mae andFreddie Mac removed limits on the companies' $1.5 trillion mortgage portfolios, bringing an end to a restriction that stifled their ability to provide financing for the housing market. --The caps, imposed in 2006 after the two largest mortgage finance companies uncovered $11.3 billion of accounting errors,will end on March 1, the Office of Federal Housing EnterpriseOversight said in a statement today. Ofheo kept in place arequirement for the companies to hold extra capital. --Fannie Mae of Washington and McLean, Virginia-based FreddieMac account for 45 percent of the $11.5 trillion residential mortgage market and were created to help expand homeownershipand to provide market stability. They make money by holding mortgage assets and on guarantees of securities they create outof loans from lenders.