The Obama administration is considering an overhaul of mortgage giants Fannie Mae and Freddie Mac that would strip billions in bad loans and create a new home-loan organization, according to the Washington Post.

Government officials told the Post that the firms' bad debt would be given to new government financial institutions that would then be responsible for collecting on the debts.

"It should come as no surprise that the administration is thinking through" these changes Andrew Williams, a Treasury Department spokesman told the Post. "We are in the preliminary stage of the process, the systematic development of options has not taken place, and no decisions have been made."

Fannie Mae and Freddie Mac were nationalized in September, and the government has pledged more than $1.5 trillion to keep them going, the Post reported.

The White House Economic Council is scheduled to discuss the proposal, which the Post calls "preliminary and one of several under discussion," on Thursday.

Congress created Fannie Mae to support mortgage lending during the Great Depression. Both groups have government charters to package and sell mortgage loans to investors, the newspaper reported.

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