Real Estate News

Miami investors win access to secret documents in Fannie Mae fight

A file photo shows mortgage giant Fannie Mae’s headquarters in Washington, D.C.
A file photo shows mortgage giant Fannie Mae’s headquarters in Washington, D.C. Associated Press

A federal judge on Tuesday ordered the U.S. Treasury Department to release more than 50 documents it tried to keep secret in a lawsuit over government-backed mortgage giants Freddie Mac and Fannie Mae.

The plaintiff is Miami-based mutual fund Fairholme Fund, which filed suit in the Federal Court of Claims in 2013. Fairholme is one of many Freddie and Fannie investors suing the federal government in different venues. The plaintiffs claim the government illegally seized the companies’ earnings after the bailout. The Obama administration says it is acting within the guidelines of Congressional legislation.

Judge Margaret Sweeney has previously ordered the government to release documents over which it exerted executive privilege. The latest batch of documents — mainly internal memos and correspondence between top Treasury officials and the White House — will remain under seal, available only to Fairholme’s attorneys.

Experts say the lawsuits could have implications for the viability of the 30-year, fixed-rate mortgage. A federal appeals court in Washington, D.C. is expected to rule soon in a crucial related case.

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