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ICYMI — American Journal News: Sununu Backs Privatizing Fannie Mae and Freddie Mac
In Case You Missed It, new reporting from American Journal News shows that Republican U.S. Senate candidate John Sununu “wants to privatize Fannie Mae and Freddie Mac, the federally backed mortgage companies that help keep home loans accessible to working families.”
After losing reelection, Sununu “called for scaling down Fannie Mae and Freddie Mac and replacing them with a fully privatized system that would involve more mortgages being held by large banks” — a model which “could lock many working-class buyers out of the housing market.”
As he runs to sell Granite Staters out to Wall Street, Sununu’s campaign has accepted $48,000 in contributions from executives at “the largest commercial landlord in the country” and $17,000 from a billionaire overseeing a hedge fund that’s “heavily invested in real estate.”
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American Journal News: Sununu backs privatizing Fannie Mae and Freddie Mac
- Republican John Sununu wants to privatize Fannie Mae and Freddie Mac, the federally backed mortgage companies that help keep home loans accessible to working families.
- Sununu is currently running for the U.S. Senate in New Hampshire, which is facing a housing affordability crisis. The state has an estimated shortage of 23,500 housing units, which is driving up demand and increasing costs.
- [...] Sununu served in the U.S. Senate from 2003 to 2009. In 2011, he wrote a Boston Globe editorial that called for scaling down Fannie Mae and Freddie Mac and replacing them with a fully privatized system that would involve more mortgages being held by large banks.
- “Forty years ago, the two government-sponsored enterprises offered local lenders the only alternative to holding mortgages on their own books,” Sununu said. “But today, that liquidity can be provided by at least a dozen large banks that securitize home mortgages, commercial loans, and other assets.”
- He added that a program to make mortgages more accessible was unnecessary because “the U.S. government has dozens of programs that subsidize housing, including discounted loans for first-time buyers, rental vouchers, and traditional low-income housing stock.”
- Americans for Financial Reform, a consumer rights nonprofit, says this model would make the lending industry more profit-driven and could lock many working-class buyers out of the housing market.
- Without government backing, the securities sold by Fannie Mae and Freddie Mac would become riskier, allowing investors to demand higher returns and drive up mortgage payments.
- Sununu has received donations from executives who would likely benefit from such a change. His campaign reported taking in $48,000 from executives at Blackstone, the largest commercial landlord in the country. The campaign took in another $17,000 from billionaire John Paulson, who runs a hedge fund that is heavily invested in real estate.
- Both Paulson and Blackstone endorsed a 2017 proposal to privatize Fannie Mae and Freddie Mac. NPR reported in February that privatization would be a “windfall” for Paulson.
- Sununu will face former Massachusetts Sen. Scott Brown in a Sept. 8 primary. [...]
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