REFILE-UPDATE 2-No change to US housing finance system this year

(Fixes montage to mortgage in paragraph 2) (Rewrites first paragraph, adds more Geithner and Bernanke comments, background)

By David Lawder and Corbett B. Daly

WASHINGTON Feb 24 (Reuters) - Changes to the way U.S. homes are financed are not likely to take place until next year at the earliest, U.S. Treasury Secretary Timothy Geithner said on Wednesday.

Geithner told the House of Representatives Budget Committee that the administration would lay out "broad principles" for restructuring mortgage finance companies Fannie Mae FNM.N and Freddie Mac FRE.N this year, but he said detailed legislative proposals would not be offered until 2011.

Congress would then have to debate and vote on the proposal for any changes to their structure before the president could sign then into law.

"We want to make sure that we get it right, that we do it carefully. We can't do everything right away," the Treasury chief said.

Geithner also said he opposed a move to put trillions of dollars in obligations of the two government-controlled entities on the federal budget.

"We do not think it is necessary to consolidate the full obligations of Fannie and Freddie onto the nation's budget but we do think it's very important ... that we make it clear to investors around the world that we will make sure that we will take the actions necessary" to keep the two entities stable, Geithner told lawmakers.

The top Republican on the House Financial Services Committee, Representative Spencer Bachus of Alabama, said on Tuesday that Fannie's and Freddie's status off the federal books is "the same sort of financial shell game that has brought governments like Greece to a crisis point."

Fannie was formed in the late 1930s in the wake of the Great Depression as a government agency and was chartered by Congress in 1968 as a private, shareholder-owned company in order to take it off the federal books. Freddie was chartered by Congress in 1970 to provide an alternative to Fannie.

That unique quasi-governmental status led them to be known as "government-sponsored enterprises."

In the midst of the financial crisis of 2008, then-Treasury Secretary Henry Paulson placed the two firms into "conservatorship," which allowed the government to take control of the firms but left the ownership stake at 79.9 percent, just under the threshold for putting them on the budget.

Conservatorship was meant to be temporary while the government figured out how to structure the entities for the long-term.

The Obama administration had said it would lay out a long-term vision for both Fannie and Freddie in the White House budget proposal released earlier this month, but the document simply said it would monitor the situation closely and provide updates "as appropriate."

House Financial Services Committee Chairman Barney Frank had scheduled a hearing on the future of housing finance for next week, but that hearing was postponed on Tuesday to sometime later in March. Geithner and Housing and Urban Development Secretary Shaun Donovan were invited to the original hearing.

Frank has said he wants the entities "abolished" in their current form, but he has not made it clear what that means.

Federal Reserve Board Chairman Ben Bernanke told Frank's panel on Wednesday the U.S. central bank would not support a return to the pre-conservatorship quasi-governmental status.

"We would not support -- let me be careful -- I think we would be very cautious about supporting a return to the existing structure where you have this potential conflict between private shareholders and the public objectives," Bernanke said.

"I think there are alternatives ... which would be a more stable long-term solution, including either a privatization approach with government guarantees or a public utility approach," Bernanke added.

Paulson, promoting his memoir, said on Tuesday the two entities "should at a minimum be scaled way back" after the housing market settles, the Chicago Tribune reported.

Earlier on Wednesday, Freddie Mac said it lost $7.8 billion in the fourth quarter and it would likely have to tap a credit line from Treasury this quarter. Freddie has already tapped about $52 billion from the credit line first established by the Bush administration in 2008. The Obama administration changed the terms of that credit line on Christmas eve to allow unlimited losses at both Fannie and Freddie.

Fannie Mae, which has already tapped about $61 billion from the Treasury credit line, is expected to report its fourth quarter results shortly. (Editing by Kenneth Barry)