GSE’s and Private Sector to Share Risks

Speaking to the American Real Estate & Urban Economics Association, special adviser to the Treasury secretary Michael Stegman, noting the restructuring of GSEs to allow private investors to share the risks of Fannie and Freddie MBS (mortgage-backed securities), says: “We believe that this initiative could help support our broader efforts to restart the private mortgage market, shrink the government’s footprint in housing finance, and protect the long-term interests of taxpayers.” NationalMortgageNews tells the loans would have to structure private investors in to risk-sharing, and be attractive to a wide investor base. GSE executives will receive compensation incentives if they initiate risk-sharing deals by the end of Sept. 2012.

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