HUD's FY99 Budget
Regulation of Federal National Mortgage Association
and Federal Home Loan Mortgage Corporation
Under Title XIII of the Housing and Community Development Act of 1992 (P.L. 102-550), the Director of the Office of Federal Housing Enterprise Oversight (OFHEO) is responsible for ensuring that Fannie Mae and Freddie Mac are adequately capitalized and operating safely. The Act authorizes the Director to collect annual assessments from the GSEs to provide for the Office's costs and expenses. OFHEO submits a seperate budget justification which is presented later in these justifications.
Except for the authority of the Director of OFHEO and other safety and soundness matters, the Secretary has general regulatory power over Fannie Mae and Freddie Mac and is directed to make rules and regulations to ensure that the Secretary�s authority under Title XIII and the purposes of the Fannie Mae Charter Act and the Freddie Mac Act are accomplished. Under the Act, the Secretary�s regulatory responsibilities include: establishing, monitoring, and enforcing housing goals for the GSEs' purchase of mortgages on housing for low- and moderate-income families, housing located in central cities, rural areas, and other underserved areas and meeting the needs of and affordable to low-income families in low-income areas and very low-income families; reviewing new GSE programs; establishing Fair Housing requirements; reporting annually to Congress, including reports on the housing goals; and reviewing and approving certain determinations, actions, and functions of the Director. The expenses for these regulatory functions come mainly from the Salaries and Expenses, HUD account.
NOTE:The Federal Home Loan Mortgage Corporation (Freddie Mac) and the Federal National Mortgage Association (Fannie Mae) are Government-Sponsored Enterprises (GSEs), operating under Congressional charters, and owned by private shareholders. The status of the two corporations as GSEs provides them with special privileges in return for accomplishing certain public purposes prescribed by their charters, and it subjects them to regulation by the Department of Housing and Urban Development. The Treasury is authorized to make up to $2.25 billion of loans to Fannie Mae and Freddie Mac. The loan authority will be used only in emergency situations.
Content Archived: January 20, 2009