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Fannie Mae and Freddie Mac, the two government-sponsored entities
(GSEs) that back the majority of the country's mortgage market, went
into conservatorship in September of 2008 as they faced default of their
loan portfolios. e conservatorship was initially thought to be a short-
term arrangement to enable the GSEs to get back on their feet, and there
were some efforts in Congress to unwind the positions within five years,
but now there is little chance they will exit conservatorship before the
November election. In fact, the status of the GSEs may remain largely
unchanged for some time beyond that, though opinions of when and how
they would leave conservatorship are widely varied.
Further delaying any resolution is the
COVID-19 pandemic, which by mid-March
had the government focusing all efforts
on trying to minimize the effects of the
disease on the nation's health and economy.
e various stimulus efforts were being
undertaken with health and economy as the
only consideration, so after-effects on any
government plans not directly related, like
moving the GSEs out of conservatorship,
DS News speaks to the experts
about what lies ahead for Fannie
Mae and Freddie Mac and the
challenges along the path leading
out of conservatorship.
Cover Story By: Phil Britt
