Freddie Mac seeks further $6bn from taxpayers

[WestVirginiaRebel]

Financial Times:

Freddie Mac, the US-controlled mortgage financier, has requested an additional $6bn from US taxpayers, following a $4.4bn third-quarter loss, the company’s worst three-month performance in more than a year.

The home loan group said more homeowners were falling behind on their obligations and it could not count on mortgage insurers to reimburse the company for losses. Freddie set aside $3.6bn in provisions for credit losses, its highest total since the third quarter of last year.

The additional $6bn brings its total bailout from the government to $72.2bn, of which $14.9 has been returned in the form of dividends. Fannie Mae, Freddie’s much larger rival, is due to report its earnings in the coming days.

Freddie’s deteriorating financial position underscores the poor state of the US housing market. Sales are down, delinquencies are rising and the pipeline of seized homes due to flood the market is growing ever larger. Home prices, which had begun slowly to rise in late 2009 and early 2010, are falling again, sowing anxiety among homeowners and sapping their desire to spend.

“The housing sector [is] very important,” Ben Bernanke, US Federal Reserve chairman, said this week. “The problems in that sector are clearly a big reason why our economy is not recovering more quickly.”

The share of borrowers one month behind on their payments rose 2 basis points quarter on quarter to 1.94 per cent. The share of homeowners two months past due also ticked up, with the delinquency rate rising 3bp quarter on quarter to 0.7 per cent. Both measures have risen since the first quarter of the year.

Loans at least three months late or in foreclosure also rose from the second quarter to 3.51 per cent.

The company blamed the increases on high joblessness and the poor state of the US housing market.
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As a taxpayer, could I tell them where to go with their request?

[Evad]

More $$$$ down the rat hole.

A truly worthless organization, even more so than your usual gubermint operation.