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Monday, September 28, 2009

White House Could Put $35B More to Mortgage Aid

By Peter Barnes and Joanna Ossinger

FOXBusiness

The Obama Administration is close to finalizing a program that could put up to $35 billion toward mortgage assistance for low- and moderate-income borrowers, an Administration official told FOX Business.

The program would be aimed at helping housing finance agencies, or HFAs, which are generally operated by state and local governments and help first-time and lower-income borrowers get mortgages at lower rates than they might in the private market.

“We are in discussions about an HFA program as announced in February. Program details are still being ironed out,” the official said. The program could be announced as early as this week.

The plan could involve $20 billion in bonds issued by the HFAs being purchased by the Treasury Department, as well as by government-sponsored entities Fannie Mae (FNM) and Freddie Mac (FRE). Another $15 billion might be provided to facilitate short-term funding.

The plan would need approval from the White House and Treasury Secretary Timothy Geithner.

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