Freddie Mac Reports Q1 Loss of $6.7 Billion « The Washington Independent
Today, Freddie Mac — the government-sponsored enterprise that buys mortgages on the secondary market, and is currently under a Federal Housing Finance Agency conservatorship — reported losses of $6.7 billion in the first quarter.
It isn’t quite as bad as it sounds, but it is bad, and a sign of a housing market under continued duress. Part of those losses came from new accounting rules; most came from writedowns. And the FHFA will ask Treasury for a lot — $10.6 billion, to be precise – to help continue to sustain Freddie.
The Obama administration funds Freddie to allow it to stabilize the mortgage market. So what are the United States taxpayers getting for their losses? Thankfully, not nothing. In the first quarter, Freddie says it provided $97 billion in housing liquidity. It also:
- Helped finance more than 390,000 single-family homes and 50,000 units of rental housing
- Provided foreclosure alternatives for more than 71,000 struggling families
- Helped refinance $68 billion of single-family loans creating an estimated $614 million in annual interest savings for approximately 320,000 families
- Has now implemented nearly 200,000 trial and permanent modifications under the Home Affordable Modification Program (HAMP)
In the last quarter of 2009, Freddie’s losses were $6.5 billion.