Treasury changes Fannie and Freddie bailout deal - WQOW TV: Eau Claire, WI NEWS18 News, Weather, and Sports

Treasury changes Fannie and Freddie bailout deal

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WASHINGTON (WKOW) - The federal government is changing its bailout deal with Fannie Mae and Freddie Mac.

The Treasury Department says this will shrink the holdings of the two mortgage giants more quickly and will require the agencies to pay the government when it earns quarterly profits.

The government says this is an effort to deal with concerns the companies could at some point exhaust the federal support they were guaranteed. Fannie Mae and Freddie Mac were taken over by the government in September 2008 during the financial crisis.

With this change, the two firms will have to hand over all profits they earn every quarter. They will also have to accelerate the reduction of their mortgage holdings to hit a cap of $250 million by 2018, four years earlier than planned.

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