The housing market has slowly begun to improve, but has a long way to go before it's healthy. Many homeowners are still defaulting on their mortgages. Unemployment remains high at 8.2 percent.
Fannie and Freddie buy home loans from banks and other lenders, package them into bonds with a guarantee against default, and then sell them to investors around the world. When property values drop, more homeowners default, either because they are unable to afford the payments or because they owe more than the property is worth. Because of the guarantees, Fannie and Freddie must cover the losses.
Pressure continues on the government to eliminate Fannie and Freddie and reduce taxpayers' exposure to risk. The Treasury Department put forward a plan last year to slowly dissolve the companies, though that process could take years. Abolishing Fannie and Freddie would transform how homes are bought and redefine who can afford them.
Word came Monday that a top Freddie executive is leaving the company about a year after he was promoted to oversee its single-family mortgage business. Anthony Renzi resigned to accept a job with another financial company. Renzi's departure as executive vice president of single-family business and operations and technology takes effect this month.
The move is the latest in a series of departures of top executives from Freddie and Fannie. Freddie CEO Haldeman and Fannie CEO Michael J. Williams both plan to step down this year.
The government said recently it will cap pay for Freddie and Fannie chief executives at $500,000 per year and eliminate annual bonuses for all employees. Those changes came after Congress pressured the government to stop big payouts at the bailed-out companies.
The federal agency that oversees Freddie and Fannie also said it would cut pay for about 50 other executives at the two companies. Those employees are still eligible to earn salaries above the cap.