The government takeover of Fannie Mae and Freddie Mac has raised as many questions as it has answered in lenders' minds about what it will be like to do business with the government-sponsored enterprises in the months ahead.

A stated goal of placing Fannie and Freddie into conservatorship (an action that has made "GSE" something of a misnomer) is to ensure that money keeps flowing into the mortgage market. But the Treasury Department's plan also envisions whittling away their portfolios after a brief period of expansion. Meantime, the Federal Housing Finance Agency said it plans to tighten regulation of the companies as mandated by the law that created it.

Many market observers and lenders predicted Monday that the regulators' near-term actions would reduce mortgage rates, sparking a wave of refinancings, which would benefit lenders. Further, some said, the takeover could lead to a reduction of the guarantee fees that Fannie and Freddie charge. These sources pointed to Treasury Secretary Henry Paulson's remark Sunday that the GSEs should examine the structure of such fees "with an eye toward mortgage affordability."

But other observers said having the government running Fannie and Freddie could make guarantee pricing less favorable for bigger lenders. No longer concerned about volume or market share, this line of thinking goes, Fannie and Freddie will be less inclined to give breaks on guarantee fees to their bigger suppliers.

David Zugheri, the president of First Houston Mortgage Ltd., a retail lender that specializes in prime conforming loans, said he expects a change from the times during which the GSEs "paid up for volume."

"What they should do is look at everyone's book of business and lower the g-fees for those lenders that have less risk, not volume," he said. "They should be paying more for quality" by reducing the guarantee fees for less risky loans, he said.

In an e-mail to clients on Sunday, Joe Garrett of the consulting firm Garrett, Watts & Co., wrote that Fannie and Freddie might "cut way back on offering lower guarantee fees in return for promised volume. If this were to occur, it will suddenly be much more attractive to sell directly to them, as opposed to selling to the big aggregators who get lower … fees."

Joseph P. Bowen, the chief operating officer and head of secondary marketing at Franklin American Mortgage Co., a privately held lender in Franklin, Tenn., said he expects the fees to drop.

"With the federal government intervening and providing that backstop, you would anticipate that credit costs would go down and the fees would go down," he said.

During the past nine months, Fannie and Freddie have imposed several loan-fee increases to reflect higher market risk and to bolster their profits. Industry trade groups complained that the increases were making mortgage credit too expensive for consumers, but GSE executives insisted the increases were needed.

"Rates were artificially high because Fannie and Freddie were paying for the sins of the past with the g-fees of the future," Mike Drury, an executive vice president at the M&T Bank unit of $65 billion-asset M&T Bank Corp. in Buffalo, said Monday.

John Courson, the new chief operating officer of the Mortgage Bankers Association, said Monday that the trade group will "engage the new conservatorship management to take a fresh set of eyes" to both guarantee and delivery fees.

The Treasury Department said Sunday that it would let Fannie and Freddie expand their portfolios by a combined $144 billion, to up to $850 billion each, by December of next year. The department itself said it plans to buy an unspecified amount of Fannie and Freddie mortgage-backed securities.

As a result, "conforming-mortgage rates and spreads should now return to normal levels based upon prepayment risk and not upon uncertainties about credit risk or liquidity," wrote Bill Longbrake, a retired vice chairman of Washington Mutual Inc. and now a director of First Financial Northwest, in an e-mail Sunday.

Several bankers said that, with 30-year, fixed mortgage rates having fallen near 6%, borrowers would find refinancing advantageous, sparking a potential refi boom. "There are enough hungry lenders who could do 30% more volume without having a cost-push effect" on wages, Mr. Drury said, adding that competitive pricing exists in markets such as northern Virginia, New England, and urban Pennsylvania.

James Deitch, the chairman and chief executive of $247 million-asset American Home Bank in Mountville, Pa., said tightening mortgage spreads would have a positive effect on consumers, "allowing affordability and opening up the potential for consumers to refinance if spreads tighten to their historic levels" of June 2007.

Mr. Drury said he expects borrowing costs to fall as much as a percentage point; any reduction in guarantee fees would be passed directly to consumers. "Things will probably get better for the consumer," he said, "and that means they might get better for the banks as well."

Mr. Bowen said Franklin American was fielding questions Monday from its community bank, credit union, and broker customers about renegotiating rates on loans that had not closed. But he suggested that lenders would more probably have to raise rates in order to control volume. "If we get into another refi boom, the question is whether the industry has the capacity to handle it," he said.

However, under the Treasury Department's plan, after 2009 the GSEs' portfolios would start to shrink at a rate of 10% a year until they reached $250 billion each. Lenders also asked what it would mean for the secondary market once the GSEs' portfolios and buying capacities were reduced.

"No one has the capital to lend today, so if we're going to push more business … into the private market, and the private market doesn't exist, how is it going to function?" Mr. Bowen asked.

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