One blueprint for turning Fannie Mae and Freddie Mac into privately run enterprises that is getting some play at Treasury comes from Redwood Trust — the firm that made headlines this spring when it pulled off the first private-label jumbo securitization in almost two years.

In a comment letter, Redwood chief executive Martin Hughes outlined a plan for transferring Fannie and Freddie's infrastructure to a lender-sponsored cooperative (LSC) that would continue to guarantee prime conforming mortgages during a 10-year transition period.

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