By Dona DeZube, HouseLogic.com

As Congress considers its options for dealing with the future of mortgage giants Fannie Mae and Freddie Mac, it needs to make sure home owners continue to have access to safe, affordable mortgages, NATIONAL ASSOCIATION OF REALTORS® President-Elect Moe Veissi told the House Financial Services Subcommittee on International Monetary Policy and Trade at a hearing this week.

“Repairs to our current housing finance structure must be made, but we must be careful that changes to the system do not come at the expense of home ownership opportunities for middle- and lower-income Americans,” he said.

Fannie Mae and Freddie Mac, along with FHA, currently guarantee about 90% of new U.S. mortgage loans.
Fannie Mae and Freddie Mac help keep mortgage money flowing to home owners and home buyers because they buy mortgage loans from banks and other lenders and then package the loans into securities sold to investors. Banks would be unlikely to offer long-term fixed-rate mortgages because they would be at risk from rising interest rates if they couldn’t immediately sell those mortgages to investors.

To make sure fixed-rate mortgages continue to be available to home owners, Veissi encouraged the panel to support legislation introduced by Reps. Gary Miller, R-Calif., and Carolyn McCarthy, D-N.Y., to create a federal replacement for Fannie Mae and Freddie Mac that would buy mortgages from bankers.