Ill. AG Calls For Fannie, Freddie Principal Reductions

Law360, New York (March 23, 2012, 6:36 PM EDT) -- Illinois Attorney General Lisa Madigan on Friday called on the government regulator overseeing Fannie Mae and Freddie Mac to allow the mortgage giants reduce the amount of money underwater homeowners owe.

In a letter to Federal Housing Finance Agency Acting Director Edward J. DeMarco, Madigan called the agency's continued insistence that Fannie and Freddie not engage in principal reductions as a tactic to prevent unnecessary foreclosures was “illogical and untenable,” as well as based on a faulty analysis of the effect it would have on the...
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