The Congressional Budget Office proposed that Fannie Mae and Freddie Mac pay "user fees" of about $700 million annually to compensate the federal government for its support.

In a report released Monday, the CBO suggested that the secondary-market agencies pay fees to the government of 0.15% and 0.025% on the average amount of debt and of mortgage-backed securities, respectively, that are outstanding each year.

The CBO recommendations are part of a broad study on how to reduce the federal deficit. The chairman of the House Budget Committee, Rep. John Kasich (R-Ohio), proposed user fees for Fannie Mae and Freddie Mac last year.

The two agencies said they oppose such fees, calling them taxes on homeownership.

The CBO estimated that Fannie Mae and Freddie Mac probably saved more than 30 cents every year on every $100 of long-term debt they have because of their ties to the federal government. On mortgage-backed securities issued and guaranteed by the two agencies the cost advantage probably exceeds 5 cents for every $100 of securities outstanding each year, the CBO said.

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