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February 8, 2011

U.S. To Cut Mortgage Support
President Barack Obama and members of his administration are currently mulling over a plan that would limit the government's support over time to less than 50 percent. The move would be part of a broader plan to restructure the housing finance industry, sources close to the plan say.

Obama has been under pressure in recent weeks to come up with a plan to pull government support of mortgage giants Fannie Mae and Freddie Mac. The government currently guarantees or owns over 85 percent of the nation's active mortgages, and Republican leaders have called for the reduction of government involvement in the mortgage guarantee business.

Key housing officials meanwhile, are scheduled to meet late Tuesday afternoon to approve a proposal to overhaul the housing finance system, a move that has been anticipated for some time. A spokesman for the Treasury declined to comment because the report had not yet been released. There has been rampant speculation about the so-called "white paper" and what it will mean for Fannie mae and Freddie Mac's long-term future.



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