US Considers Takeover Of Fannie May, Freddie Mac

119 votes

huffingtonpost.com — Alarmed by the growing financial stress at the nation's two largest mortgage finance companies, senior Bush administration officials are considering a plan to have the government take over one or both of the companies and place them in a conservatorship

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  1. Unforetunately, Fannie / Freddie are feeling the same pain as the subprime lenders. The biggest issue is that starting about 2001... lenders started to place more importance on FICO credit scores than debt to income ratios. Even Fannie / Freddie where doing loans with DTI was over 55% of peoples gross for just the mortgage and reported bills on the credit report. If IRS gets the other 30% it only leaves 15% to live on. If more is going out than coming in then eventually something is going to break.

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  2. Just when you thought it was over...

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  3. well there's a precedent - Look at Northern Rock (Northern Wreck) in the UK

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