NEW YORK: Fannie Mae and Freddie Mac are in discussions with U.S. government officials to join government programs aimed at reducing mortgage balances where borrowers owe more than the values of their homes, the Wall Street Journal reported on Tuesday citing people familiar with the situation.
The paper reported that Fannie Mae and Freddie Mac have been highly reluctant to reduce mortgage balances, especially for borrowers who are still making payments.
The report also said the government is pressuring both mortgage companies to join a program run by the Federal Housing Administration that allows banks and other creditors, which agree to write down mortgages, to hand off the reduced loans to the FHA.
(Reporting by Yinka Adegoke)
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More:Federal Housing Administration Foreclosure Crisis Loan Modifications Freddie Mac Mortgage Modifications
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