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To: Brumar89 who wrote (391177)	11/4/2010 5:49:28 PM
From: FJB	Respond to of 793975

Freddie Seeks $100 Million After Third-Quarter Loss By Lorraine Woellert - Nov 3, 2010 11:33 AM CT bloomberg.com Freddie Mac, the mortgage-finance company operating under federal conservatorship, requested $100 million in U.S. Treasury Department aid after reporting a narrower loss for the third quarter. The company reported a loss of $4.1 billion for the three months ended Sept. 30, including $1.6 billion owed to Treasury as a dividend payment on the federal government’s 80 percent stake, McLean, Virginia-based Freddie Mac said today in a U.S. Securities and Exchange Commission filing. Freddie Mac requested $1.8 billion when it reported a $6 billion second-quarter loss. The request for aid accompanying Freddie Mac’s fifth straight quarterly loss adds to the $63 billion the government- sponsored firm has received since September 2008, when it was seized by regulators along with Washington-based Fannie Mae. Including today’s request, the two firms have received more than $148 billion in aid and returned $14.6 billion in dividends. “Although Freddie faces a number of challenges, the biggest single drain on the bottom line will be the dividends,” Jim Vogel, head of agency debt research at FTN Financial in Memphis, Tennessee, said in an e-mail. Freddie Mac and Fannie Mae were chartered by the federal government to boost homeownership by buying mortgages from lenders and providing a U.S. guarantee of principal. Freddie Mac said it owned or guaranteed about 23 percent of single-family mortgages as of Sept. 30. Non-performing Loans Non-performing single-family loans on the company’s books rose to $112.7 billion in the third quarter from $85.9 billion a year earlier. Loans at least 90 days past due “remained high due to the continued weakness in home prices and persistently high unemployment, extended foreclosure timelines in many states, and challenges faced by servicers in building capacity to process large volumes of problem loans,” the company said. Investments Freddie Mac made in private-label securities backed by subprime loans continue to deteriorate. The company said losses on those investment pools grew to $1.1 billion from $400 million in the second quarter of this year. Freddie Mac said it is pressing lenders to honor promises to repurchase nonperforming loans, including those in supbrime investment pools, if they were issued based on inaccurate data. Known as representations and warranties, the promises cover defects such as inflated appraisals or inaccurate information about a borrower’s income. In the three months ending Sept. 30, Freddie Mac had $5.6 billion in unpaid repurchase requests outstanding and had recovered $1.7 billion from lenders. Some of the company’s largest single-family loan servicers collectively had more than a third of repurchase demands outstanding for more than four months, up from 23 percent.

To: Brumar89 who wrote (391177)	11/4/2010 5:51:08 PM
From: FJB	2 Recommendations Read Replies (1) \| Respond to of 793975

Fannie Mae, Freddie Mac Fix May Cost U.S. Taxpayers $685 Billion, S&P Says By Clea Benson - Nov 4, 2010 2:23 PM CT bloomberg.com Fannie Mae and Freddie Mac, the mortgage firms operating under federal conservatorship, may cost taxpayers as much as $685 billion as the U.S. covers losses and overhauls the housing-finance system, Standard & Poor’s said. Costs for resolving the two government-sponsored entities could reach $280 billion, including $148 billion already delivered under a U.S. Treasury Department promise of unlimited support, New York-based S&P said today in a research report. The government may spend another $405 billion to capitalize a replacement for the two companies, which own or insure more than half the U.S. mortgage market. Continues...