Friday, October 22, 2010

Fannie, Freddie Bailouts Could Total $363 Billion

By Robert Romano
The total taxpayer tab for the government bailout of Fannie Mae and Freddie Mac could total $363 billion under a worst-case scenario, according to the Federal Housing Finance Agency (FHFA). That scenario assumes further declines in housing prices, which many analysts are already predicting.

It could even be worse than that, however.
Right now, the Government Sponsored Enterprises (GSEs) that helped cause the housing bubble in 2000’s and the financial crisis that followed with loose lending standards have an unlimited credit line from the U.S. Treasury. The bailouts have already cost $148 billion, and although the unlimited credit line expires at the end of 2012, after that the companies will be entitled to another $275 billion, according to former chief credit officer of Fannie Mae Edward Pinto.
Get full story here.

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