FHFA
Streamlined Modification Program
Date:
November 11, 2008
Who:
FHFA
Policy Area:
Sector Policy (Non-Financial)
Economic Target:
Housing
Action Type:
Regulatory Change Creation of fast-track method for reducing monthly payments on mortgages held by Fannie Mae or Freddie Mac, restricting payments to 38 percent of income, reducing the interest rate, extending loan periods, and, deferring principal.
Source:
Notes:
CBO's estimate from "Budget and Economic Outlook: Fiscal years 2009 to 2019" (http://www.cbo.gov/doc.cfm?index=9957) is listed as "unknown." FHFA is the Federal Housing Finance Agency.
Purchase of Freddie Mac Preferred Stock
Who:
FHFA
Policy Area:
Sector Policy (Non-Financial)
Economic Target:
Government and GSEs
Action Type:
Equity Purchase
Maximum Amount:
> $100.00 billion
Amount Spent:
$63.70 billion As part of conservatorship, the Treasury agreed to purchase up to $100 billion in stock from each GSE ($200 billion total) including an immediate receipt of $1 billion in senior preferred stock from each GSE as well as warrants to purchase 79.9% of each GSE's common stock. On 2/13/2009, the Treasury Department increased the maximum amount of GSE stock they would agree to purchase by $100 billion each, bringing the total to $400 billion. At the time, they estimated that, in total, they would be required to purchase $50 billion from Freddie Mac and $16 billion from Fannie Mae.
Notes:
Since the purchase of Freddie Mac preferred stock by FHFA constituted an intergovernmental transfer of stock from a GSE to a federal agency, the deficit impact is zero. Amount spent as of 2/25/2011 (http://www.fhfa.gov/Default.aspx?Page=70).
Purchase of Fannie Mae Preferred Stock
Date:
September 7, 2008
Who:
FHFA
Policy Area:
Sector Policy (Non-Financial)
Economic Target:
Government and GSEs
Action Type:
Equity Purchase
Maximum Amount:
> $100.00 billion
Amount Spent:
$98.70 billion As part of conservatorship, the Treasury agreed to purchase up to $100 billion in stock from each GSE ($200 billion total) including an immediate receipt of $1 billion in senior preferred stock from each GSE as well as warrants to purchase 79.9% of each GSE's common stock. On 2/13/2009, the Treasury Department increased the maximum amount of GSE stock they would agree to purchase by $100 billion each, bringing the total to $400 billion. They estimated that, in total, they would be required to purchase $50 billion from Freddie Mac and $16 billion from Fannie Mae.
Notes:
Since the purchase of Fannie Mae preferred stock by FHFA constituted an intergovernmental transfer of stock from a GSE to a federal agency, the deficit impact is zero. Amount spent as of 5/9/2011 (http://www.fhfa.gov/Default.aspx?Page=70).
Conservatorship of Fannie/Freddie
Date:
September 7, 2008
Who:
FHFA
Policy Area:
Sector Policy (Non-Financial)
Economic Target:
Government and GSEs
Action Type:
Government Conservatorship
Deficit Impact:
$389.00 billion Placement of Fannie Mae and Freddie Mac into government conservatorship by the Federal Housing Finance Agency, until the institutions are deemed to have been stabilized. Conservatorship was coupled with other actions to ensure liquidity.
CBO estimates that $291 billion in federal outlays went towards the conservatorship of Fannie and Freddie in 2009, with a projected $98 billion in subsidies over the next 10 years.
Notes:
Deficit impact represents CBO's estimate of the cost of bringing Fannie Mae and Freddie Mac "on-budget" for 2009-2019 (per CBO's proposed budgetary treatment) calculated by assessing the risk-adjusted net present value of Fannie Mae's and Freddie Mac's current net liabilities, plus their subsidy costs for 2009. (http://www.cbo.gov/ftpdocs/108xx/doc10878/01-13-FannieFreddie.pdf).
