Fannie Mae and Freddie Mac, the nation's biggest mortgage underwriters through purchases on the secondary market of loans, have said they will not allow borrowers who have walked away from their loan for strategic reasons (i.e., the loan was under water but they could still afford to pay).  This decision is counter to intelligent policy and will saddle Fannie and Freddie with decisions it cannot possibly make. As both of these entities are owned by the Federal Government, they should be operating in the public interest and not in regard to boosting profits. This move might help forestall some borrowers from defaulting, but it will involve a complex evaluation of whether people are strategically defaulting, and it is not clear how fannie and Freddie will figure that out. It is not like these agencies were particularly good at their initial credit decisions or evaluating the loans they purchased. Furthermore, parties to a contract should be allowed to default and accept the consequences. Additional penalties beyond foreclosure pervert the process of making a contract and are unfair to borrowers.  Banks and others often default on loans and other contracts when it is in their economic favor, and it is likely the most efficient result for many homeowners. The Federal Government should not be discouraging people from seeking out their best economic advantage just because it is bad for banks, Fannie and Freddie.