WASHINGTON — Credit unions report very little impact from therecent government takeover of Fannie Mae and Freddie Mac. But NavyFederal Credit Union's Jack Gaffney, executive vice president oflending, said that, in the long term, the takeover is not good forthe financial services industry.

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Government ownership of Fannie Mae and Freddie Mac will probablymean that it will be more expensive to sell loans on the secondarymarket. “When the government gets involved, you tend to see thecost of things go up,” he said.

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And, Scott Toler, president and chief executive officer forCredit Union Mortgage Asociation, said the only impact on creditunions so far has been a drop in interest rates–a move, he said,that is more related to perception. Changes in the two mortgagegiants will be dictated by the market, he said. If the economyrebounds, there won't be as many changes and there won't be as muchgovernment involvement.

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Toler said Fannie and Freddie's new regulator might tighten upunderwriting standards while addressing an industry hope that the5% downpayment requirement might be loosened.

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