Category
Fannie/Freddie
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11.21.08Stay in your home for the holidays!From CNN: Mortgage giants Fannie Mae and Freddie Mac have directed their network of servicers to halt all foreclosure and eviction proceedings between Nov. 26 2008 and Jan. 9, 2009, meant to give a recently announced rescue plan time to work. The Streamlined Modification Program, set to launch Dec. 15, enables delinquent borrowers to get a modified mortgage that lowers payments to no more than 38% of their gross incomes. "By delaying these foreclosure sales, the nation's servicers will have the opportunity to work with more borrowers who could qualify for a modification under the new [program]," said Freddie Mac CEO David M. ...
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11.14.08Freddie loses $25 BillionFrom CNN: Freddie Mac reported a $25 billion quarterly loss Friday that forced the mortgage finance giant to tap $100 billion in bailout money set aside by the government. The loss triggered a $13.8 billion Treasury Department investment in Freddie (FRE, Fortune 500). The firm is likely to get the money by the end of the month; Treasury will receive preferred shares in return. A Treasury spokeswoman did not have any immediate comment. Treasury and regulator Federal Home Finance Authority announced on Sept. 7 that they had taken control of Freddie and Fannie Mae, the other giant mortgage finance company, when it became ...
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11.10.08Fannie Mae reports $29 Billion quarterly lossFrom Bloomberg: Fannie Mae posted a record quarterly loss as new Chief Executive Officer Herbert Allison slashed the value of the mortgage-finance provider's assets by at least $21.4 billion and said it may need to tap federal funds next year. In its first report since being seized by the U.S. government last month, Washington-based Fannie Mae said its third-quarter net loss was $29 billion, or $13 a share, from $1.4 billion, or $1.56, a year earlier. Allison, installed last month when the government took over Fannie and its smaller rival Freddie Mac, reduced most of Fannie's deferred tax credits, increased default estimates and ...
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09.01.08Trouble at WaMu?There's desperation in the air at Washington Mutual, and a 5 percent return on CDs to prove it. The lender, caught in the throes of the real estate meltdown, is currently offering a rate for certificates of deposit that is over twice that of the Fed Funds and discount rates. Desperate to attract money on deposit which then can be used to offset mortgage losses, a lender will often offer a much higher rate on depository accounts - in fact, it's a well-chronicled step in death-spiral financing. Countrywide did it. IndyMac did. And now Washington Mutual is. the 5% solution, originally uploaded ...
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08.18.08Fannie, Freddie shares batteredFrom CNN: Shares of mortgage finance giants Fannie Mae and Freddie Mac, suffering their worst day since a mid-July free fall, plunged Monday to their lowest points in nearly two decades. Fannie (FNM, Fortune 500) fell 22% and Freddie (FRE, Fortune 500) lost 25% after a Barron's report suggested that a government takeover of the troubled mortgage financiers is inevitable. Fannie closed down $1.76 to $6.15 a share, the stock's lowest level since May 12, 1989, according to the Center for Research in Security Prices at the University of Chicago business school. Fannie ended down $1.46 to $4.39, its lowest point since ...
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08.18.08Recapitalization of Fannie and Freddie likelyFrom Reuters: The U.S. Treasury is growing increasingly likely to recapitalize Fannie Mae and Freddie Mac in the months ahead on the taxpayer's dime, Barron's reported in its August 18 edition. The weekly financial newspaper said that such a move could wipe out existing holders of the agencies' common stock, with preferred shareholders and even holders of the two entities' $19 billion of subordinated debt also suffering losses. An insider in the Bush administration told Barron's that Fannie and Freddie "are being jawboned" by the Treasury Department and their new regulator, the Federal Housing Finance Agency (FHFA), to raise more equity. But government officials ...
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08.18.08Fannie loses 2.3 billionFrom CNN: Mortgage finance giant Fannie Mae reported a much larger-than-expected loss in the second quarter and slashed its dividend, more signs that the problems in housing and financial markets are not over. The firm reported a net loss of $2.3 billion, or $2.54 a share. Analysts surveyed by Thomson Reuters forecast a loss of 68 cents a share, compared to earnings of $1.86 a share a year earlier. But large increase in reserves for bad debt and a writedown in the value of its holdings hurt the results. The company also slashed its quarterly dividend to 5 cents a share, down 86% ...
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08.18.08Freddie Mac loses $821 million for the quarterFrom Bloomberg: Freddie Mac, the U.S. mortgage-finance company hobbled by record foreclosures, slashed its dividend at least 80 percent after posting a quarterly loss that was three times wider than analysts’ estimates. Freddie dropped 19 percent in New York trading and the larger Fannie Mae declined 15 percent on mounting concern that the government-chartered companies will sacrifice shareholders to bolster capital. Freddie doubled its reserves for future home- loan losses to $2.8 billion, a sign that Chief Executive Officer Richard Syron sees no end in sight to the worst housing slump since the Great Depression. The results, combined with Syron’s delay in selling ...