Geithner: Government should have role in mortgage system

interns Contributor
Font Size:

WASHINGTON (Reuters) – The government should continue to play a role in any new system of housing finance Congress develops, Treasury Secretary Timothy Geithner told lawmakers on Tuesday as they began debate an overhaul of the way Americans buy their homes.

Despite the need for some government role, mortgage finance giants Fannie Mae (FNM.N) and Freddie Mac (FRE.N) should not be fully nationalized, the Treasury chief said.

“I think there is a quite strong economic case, quite a strong public policy case, for preserving, designing some form of guarantee for the government to help facilitate a stable housing finance market,” Geithner told the House of Representatives Financial Services Committee.

Geithner said the central role the housing sector plays in the U.S. economy and its vulnerability to financial shocks justified a degree of government backing.

Full story: Geithner: Keep public role in housing finance – Reuters via Yahoo! News