Regulator Rebuffs Obama on Plan to Ease Housing Debt

http://www.nytimes.com/2012/08/01/business/us-agency-bars-fannie-and-freddie-from-reducing-principal.html?hp

The independent federal agency that administers Fannie Mae and Freddie Mac said once again on Tuesday that it would not let the mortgage finance companies offer debt forgiveness to homeowners, rejecting the entreaties of Congressional Democrats and the Obama administration.

The Federal Housing Finance Agency said it had concluded after months of study that debt forgiveness might benefit up to half a million homeowners, but that the costs — including the cost to taxpayers — outweighed the potential benefits.