NEW YORK, NY July 16, 2008 —Local housing advocates say they're relieved that the Treasury Department and the Federal Reserve have intervened to keep Fannie Mae and Freddie Mac solvent.

Sarah Gerecke of the not-for-profit Neighborhood Housing Services says the government sponsored lenders are playing an increasingly important role, especially for New York City homeowners with subprime loans.

GERECKE: They can't refinance with their original lender cause their original lender is out of business. So loans that are bought by Fannie Mae and Freddie Mac are providing one of the few ways that existing homeowners can maintain affordability through refinance.

REPORTER: Gerecke sits on an advisory board for Fannie Mae. Fannie and Freddie will only refinance loans worth $417,000 or less.