By Mike Colpitts
For the second time in a year, a branch of the federal government has introduced a plan to wind down the lending of mortgage giants Freddie 
Mac and Fannie Mae. The acting administrator of the Federal Housing Finance Agency sent Congress a strategic plan to wind down the lenders over the next several years.
The plan builds on Director Edward Demarco’s program sent to Congress a year ago this month and sets objectives and steps for the government backed lenders to reduce home lending, which has cost tax payers more than $180 billion in failed mortgages since the foreclosure crisis started more than five years ago.
The independent agency’s plan is at direct odds with the Obama administration, which has thrown a series of efforts at the nation’s housing crisis with little real success.
Failed Freddie and Fannie were placed into government conservatorship Sept. 6, 2008. Since that time the publicly held companies have seen their stock values drop to pennies on the dollar. Freddie Mac and Fannie Mae now provide the funding for more than 80% of all U.S. mortgages, but would be decreased with the proposal sent to Congress.
Demarco’s plan identifies three strategic goals for the next phase of conservatorship:
(1) Build a new infrastructure for the secondary mortgage market;
(2) Gradually contract the Enterprises’ dominant presence in the marketplace, while simplifying and shrinking their operations; and
(3) Maintain foreclosure prevention activities and credit availability for new and refinanced mortgages.
“With the conservatorships operating for more than three years and no near-term resolution in sight, it is time to update and extend the goals and directions of the conservatorships,” DeMarco wrote.
“FHFA is contemplating (the) next steps to build an infrastructure for the secondary mortgage market that is consistent with existing policy proposals and will support any outcome of the leading legislative proposals. FHFA looks forward to working with Congress and the Administration on a resolution of the conservatorships and a comprehensive review of the nation’s housing finance system.”