Shaun Donovan, HUD Chief, Hopes Fannie Mae and Freddie Mac Will Write Down Mortgages

After a year of arguing with Fannie Mae and Freddie Mac over the benefits of loan write-downs, the Obama administration is taking another approach: show, rather than tell. Officials are betting that the eventual success of the government's $25 billion deal with five of the nation's largest banks will convince the mortgage giants to fall in line. In an interview with The Huffington Post on Thursday, Shaun Donovan, secretary of the U.S. Department of Housing and Urban Development, said that last week’s national foreclosure settlement could "catalyze the national effort" for loan write-downs, also called principal reductions, and bring Fannie Mae and Freddie Mac on board to follow suit....