New York Gov. Eliot Spitzer and state Attorney General Andrew Cuomo are seeking ways to ease the increasing problems within the mortgage industry.

In a joint letter to Congress, Spitzer and Cuomo called for continued federal action to combat subprime lending practices, while preserving the authority of state and local governments to develop and enforce protections specific to the needs of constituents. The state, they said, also wants to assist homeowners who are impacted by foreclosures through a $2 million matching grant program.

That was part of a package of initiatives that Spitzer and Cuomo and members of the Governor's Halt Abusive Lending Transactions Task Force introduced. The task force was formed last March.

The letter was forwarded to, Rep. Nancy Pelosi, speaker of the House, and Senate Majority Leader Harry Reid.

Cuomo's office has been involved in a nine-month investigation into the mortgage-lending business.

The AG's office said Wednesday that subpoenas have been sent to Fannie Mae and Freddie Mac, and the office recently filed a suit against First American Corp. and its subsidiary, eAppraiseIt, for colluding with Washington Mutual to inflate the appraisal values of homes.

Fannie Mae, or the Federal National Mortgage Association, and Freddie Mac, or the Federal Home Loan Mortgage Corp., are two of the largest financiers of home mortgages in the country, and both purchase loans from Washington Mutual. Washington Mutual is the third largest provider of loans to Fannie Mae, selling $24.7 billion in loans in 2007 alone. Washington Mutual is also the fourteenth largest provider of loans to Freddie Mac, selling $7.8 billion in loans in 2007.