HUD's FY99 Budget
Congressional Justifications

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.