The U.S. Treasury Secretary Timothy Geithner said on 2 that the government hopes the reform of housing finance market, but the process should not be rushed.
"... Probably require five to seven years" to reduce the two giant government-backed mortgages, Fannie Mae and Freddie Mac, Geithner told lawmakers in testimony.
The two firms and two smaller agencies currently are insured or guaranteed 90 percent of all new housing loans.
"While we are confident that the measures we have proposed are the right course, the rush would be counterproductive and could potentially destabilize the housing finance market, or even affect the overall recovery."
In a proposal presented to Congress on February 14, the Treasury Department outlined the government's plan to reform the housing finance system in the country, which is dominated by Fannie Mae and Freddie Mac
It is generally believed that the housing finance model dominated by the government was a major cause of this round of financial crisis. The two firms have already received more than 150,000 million dollars in ransom money from taxpayers.
Experts say American taxpayers can not afford to keep rescuing them.
However, Geithner stressed, companies should not be closed too quickly.
"Close the doors of Fannie Mae and Freddie Mac without taking into account the pace of economic recovery could shake an already fragile housing market," he said. "Finally, it is favorable to the interests of the country's economy and reduce Fannie Mae and Freddie Mac in a responsible and prudent."
"The administration is committed to a system in which the private market, under strong surveillance and a strong consumer protection and the investor, the primary source of mortgage credit."
Geithner said the Obama administration wants Congress to pass legislation to review Fannie Mae and Freddie Mac over a period of two years.
"... Probably require five to seven years" to reduce the two giant government-backed mortgages, Fannie Mae and Freddie Mac, Geithner told lawmakers in testimony.
The two firms and two smaller agencies currently are insured or guaranteed 90 percent of all new housing loans.
"While we are confident that the measures we have proposed are the right course, the rush would be counterproductive and could potentially destabilize the housing finance market, or even affect the overall recovery."
In a proposal presented to Congress on February 14, the Treasury Department outlined the government's plan to reform the housing finance system in the country, which is dominated by Fannie Mae and Freddie Mac
It is generally believed that the housing finance model dominated by the government was a major cause of this round of financial crisis. The two firms have already received more than 150,000 million dollars in ransom money from taxpayers.
Experts say American taxpayers can not afford to keep rescuing them.
However, Geithner stressed, companies should not be closed too quickly.
"Close the doors of Fannie Mae and Freddie Mac without taking into account the pace of economic recovery could shake an already fragile housing market," he said. "Finally, it is favorable to the interests of the country's economy and reduce Fannie Mae and Freddie Mac in a responsible and prudent."
"The administration is committed to a system in which the private market, under strong surveillance and a strong consumer protection and the investor, the primary source of mortgage credit."
Geithner said the Obama administration wants Congress to pass legislation to review Fannie Mae and Freddie Mac over a period of two years.
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