The Treasury Department on Monday confirmed what most mortgage lobbyists have been anticipating for months — that the White House's long-awaited report on restructuring Fannie Mae and Freddie Mac (and the U.S. housing finance system in general) will be delayed until mid-February.
Industry officials that have served as consultants to the government said a number of GSE-related options are currently being considered by the Treasury Department such as merging (at least over the short-term) Fannie and Freddie's MBS issuance business, and spinning off their multifamily guarantee business to the private sector.
It's expected that the White House will present a list of GSE "options" to lawmakers and not necessarily concrete proposals.
"The delay in releasing the report suggests there may be a debate within the administration about whether to propose a specific plan or rather to summarize options," said William Longbrake, an executive-in-residence at the University of Maryland. "The latter approach seems increasingly likely."
Some observers said officials may just be demonstrating extra caution and exhausting all ideas before committing to a plan.
Last summer, under pressure from Republican lawmakers, Treasury secretary Timothy Geithner agreed to submit the administration's GSE recommendations to Congress by Jan. 31 but over the past few months it became clear to the industry that the deadline would not be met.
Administration officials are now saying the release of its GSE "white paper" will come during the first-half of February.
Since the New Year began, there has been widespread speculation that Treasury would miss the Jan. 31 deadline due to the recent departures of key Treasury and White House officials.
