Federal Housing Finance Agency (FHFA) placed Fannie Mae and Freddie Mac into conservatorship out of concern that the deteriorating financial condition of the two government-sponsored enterprises (GSE or enterprise) threatened the stability of financial markets. According to FHFA’s former Director, James B. Lockhart III, at the time the conservatorships were established, Fannie Mae and Freddie Mac had worldwide debt and other financial obligations totaling $5.4 trillion, and their default on those obligations would have significantly disrupted the U.S. financial system. The Department of the Treasury (Treasury) has agreed to provide substantial financial support to the enterprises so that they can continue to support mortgage finance during the current financial crisis