NEW YORK (CNNMoney.com) - Just as federal officials seek to wind down many bailout programs, the Obama administration announced Monday yet another initiative to prop up the housing market.
Administration officials unveiled a plan to aid state and local housing finance agencies, which provide mortgages to first-time and lower-income homebuyers and enable the development or rehabilitation of rental properties. Officials declined to put a pricetag on the program, but said there would be no cost to taxpayers.
"This initiative is critical to helping working families maintain access to affordable rental housing and homeownership in tough economic times," said Treasury Secretary Tim Geithner.
Under the initiative, the Treasury Department, along with Fannie Mae (FNM, Fortune 500) and Freddie Mac (FRE, Fortune 500), will purchase housing bonds issued by the finance agencies. This will give the groups the funding needed to make new loans. Also, the government will provide a temporary credit program to allow the agencies to refinance their existing bonds to more favorable terms.