Fannie Mae and Freddie Mac need to take the lead in enacting principal forgiveness on mortgage loans, Iowa Attorney General Tom Miller and 10 other Democratic attorneys general said in a letter sent Thursday to the Federal Housing Finance Agency (FHFA), HousingWire reported. Led by Massachusetts Attorney General Martha Coakley, the letter, addressed to FHFA acting Director Edward DeMarco, says the “financial stability of Fannie Mae and Freddie Mac will not be harmed if they engage in principal forgiveness and according to new data could save close to $1.7 billion.” Last week DeMarco said the FHFA will likely make a decision regarding mortgage principal forgiveness this month. The agency is evaluating added incentives from the Treasury Department to write down loan principal under the Home Affordable Modification Program.