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WASHINGTON — The takeover of Fannie Mae and Freddie Mac is already showing positive signs, such as a substantial decline in mortgage interest rates, James B. Lockhart, director of the Federal Housing Finance Agency said on Capitol Hill recently.

“A lack of confidence had resulted in continued widening of the spread between yields of their MBS and yields of Treasury securities meant that virtually none of the large drop in Treasury interest rates over the past year had been passed on to the mortgage markets,” Lockhart said. “On top of that, Freddie Mac and Fannie Mae, in order to try to build capital, may have raised prices and tightened credit standards beyond what was necessary for sound underwriting. I am pleased to say that the enterprises’ funding costs and the spreads on MBS have declined,” Lockhart told the House Committee on Financial Services.

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