Fannie Mae and Freddie Mac may need additional financial help from the U.S. government, and they are unlikely to repay all of the stimulus money they receive, which stands at $85 billion so far, confirmed Federal Housing Finance Agency director James Lockhart.

While the Obama administration has relied heavily on the two firms to support the housing recovery effort, Lockhart said they would continue to be unprofitable for another year or so.

As for the future of Fannie Mae and Freddie Mac, he said the private sector should be the source of funding for the mortgage market and that the companies should not be nationalized and turned into an agency like the FHA.

Source: Washington Post, Zachary A. Goldfarb