Feb 11 2011

Fannie Mae and Freddie Mac: Implications for Credit Unions


Fannie Mae and Freddie Mac: Implications for Credit Unions engages the work of legal expert David Reiss to break down the benefits, purported and real, that Fannie Mae and Freddie Mac bring to the mortgage market and the credit union system. This research is critically important for credit unions, because:

  • The reform discussion has already begun. The Dodd- Frank reform act attacked the gamut of systemic financial shortcomings, while deferring a debate about the GSEs until 2011. Now is the time for credit unions as small mortgage lenders to make their wish lists for a redesigned secondary mortgage market.
  • The cost of the bailout is staggering. Whether as managers or simply as citizens, credit union leaders should care about the longterm effects of the GSEs’ conservatorship.
  • Credit unions lend based on the structure of the secondary mortgage market. Whatever happens to Fannie Mae and Freddie Mac will weigh heavily on mortgage lending everywhere.

This research brief also proposes four reasonable options for the future of Fannie and Freddie. Click below to watch our Research Director discuss the highlights and recent developments with the author.

Report Number 228