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Industry group proposes revamp

September 03, 2009|Times Wire Reports

A mortgage industry group wants Fannie Mae and Freddie Mac replaced with private companies that would be able to issue mortgage bonds formally backed by the federal government.

The Mortgage Bankers Assn.'s proposal would replace Fannie and Freddie with several federally regulated private companies known as Mortgage Credit Guarantor Entities. They would buy loans and sell them as bonds with their own guarantee attached, and would pay the government a fee for its backing.

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