The U.S. Treasury Department on Wednesday announced it's increasing its funding commitment to Fannie Mae (FNM) and Freddie Mac (FRE) to $200 billion each as part of a broad plan to ensure confidence in the two institutions and boost the housing market.

Specifically, Treasury is amending the Preferred Stock Purchase Agreements it has with the government-sponsored enterprises to $200 billion each from the original level of $100 billion each.

"The increased funding will provide forward-looking confidence in the mortgage market and enable Fannie Mae and Freddie Mac to carry out ambitious efforts to ensure mortgage affordability for responsible homeowners," said Treasury Secretary Timothy Geithner in a statement.

Additionally, Treasury said it will increase the size of the GSEs' retained mortgage portfolios allowed under the stock purchase agreements by $50 billion to $900 billion along with corresponding increases in the allowable debt outstanding.

Geithner said the funding boost "is not intended to indicate any estimate of possible losses with respect to the companies." Instead, the action is meant to prove to the markets that the Treasury stands firmly behind the GSEs' ability to support housing finance, even in the midst of market difficulties, the secretary said.

The GSE announcement is part of the Obama administration's broad homeownership affordability plan designed to help up to 9 million families restructure or refinance their mortgages to avoid foreclosure.

The plan also includes a $75 billion stability initiative to help homeowners who make reasonable monthly mortgage payments to stay in their homes. Under the program, a lender ideally would help bring down interest rates so a borrower's payments are no more than 38% of his or her income. The government would then match further reductions in interest payments in order to bring that ratio down to 31%.

-By Maya Jackson Randall and Jeff Bater, Dow Jones Newswires; 202-862-9249