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Why Overhauling Fannie Mae and Freddie Mac Needs Congress

Wall Street Journal

May 22, 2014, By Nick Timiraos

Legislative efforts to overhaul Fannie MaeFNMA -0.05% and Freddie MacFMCC +0.46% look unlikely to advance this year, and ideological gridlock doesn’t appear likely to abate during the next session of Congress. That’s leading to more questions from housing-finance insiders and the mortgage giants’ shareholders about whether it’s possible to overhaul the companies through administrative fiat.

 In other words, can Fannie and Freddie easily exit their government-run conservatorship and be restored as private companies without an act of Congress? Jim Parrott, a former housing adviser in the Obama White House, says that the answer is no in an article published Thursday by the Urban Institute. Here’s a look at the analysis:

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