Fannie, Freddie Mortgage Roles Could Shrink

Washington, DC, Feb. 9, 2011 -- The Obama administration will recommend the gradual elimination of government-sponsored mortgage giants Fannie Mae and Freddie Mac, a White House official said Wednesday.

The highly-anticipated "white paper," will include three different options, the official said.

Fannie and Freddie were rescued by the federal government in 2008, as the subprime crisis roiled the housing market and crippled the banking system.

According to the Wall Street Journal, the most conservative of the three options would involve no government role in the mortgage market beyond existing federal agencies, such as the Federal Housing Administration.