[...] it also opened them up to the risks of the subprime arena. [...] the prime mortgages they continued to buy and guarantee were increasingly at inflated, bubble prices, making them vulnerable to the eventual bust and the decline of housing prices.
National mortgage servicing giant Freddie Mac has barred its loan servicers from referring any new foreclosure or bankruptcy cases in New York State to Steven J. Baum PC, delivering a severe blow to a firm that depends on such work. According to a new bulletin posted on the Freddie Mac website on Thursday, effective "on or after" Nov. 10, the Amherst-based law firm is no longer an approved option for the many mortgage lenders that work with Freddie Mac.
URBANDALE, Iowa - Rising in polls and receiving greater scrutiny, Republican presidential candidate Newt Gingrich found himself on the defensive Wednesday over huge payments he received over the past decade from the mortgage giant Freddie Mac. Gingrich, who now is near the top in polling on the GOP race, said he didn't remember exactly how much he was paid, but a person familiar with the hiring said it was at least $1.6 million for consulting contracts stretching from 1999 to early 2008. The person spoke on condition of anonymity in order address a personnel matter.
To: BUSINESS EDITORS Contact: MEDIA, Michael Cosgrove, +1-703-903-2123, or INVESTORS, Linda Eddy, +1-703-903-3883, both of Freddie Mac
WASHINGTON -- Freddie Mac, the second-largest source of U.S. mortgage finance, said on Thursday it will tap an extra $6 billion from its taxpayer lifeline as the shaky housing market fueled its worst quarterly loss in more than a year. The government-owned company said it lost $4.4 billion in the third quarter, a big increase from a $2.5 billion loss in the year- ago period.
Under fire from all sides, Newt Gingrich repeatedly denied Thursday he ever lobbied on behalf of Freddie Mac and defended some of his more contentious proposals, such as abolishing federal courts he deems too activist, as he faced off against the rest of the Republican presidential field in the final debate before the Iowa caucuses. I have never once changed my positions because of any kind of payment," the former House speaker said as his fellow candidates questioned the $1.6 million in payments he took from the two government-sponsored enterprises that some have blamed for inflating the housing bubble that led to the financial meltdown.
Rising default rates and foreclosures caused the market to question whether Freddie Mac and Fannie Mae had the cash to cover defaults and whether the shrinking margin between outstanding principal and interest and the housing value assets could be covered by Freddie Mac and Fannie Mae's borrowing power. The prospect of Freddie Mac and Fannie Mae borrowing money to continue buying loans from banks suddenly became very iffy. For one thing, they reasoned, why pump private money into Freddie and Fannie when it was implicitly understood that the government would almost certainly step in with some form of assistance with cash, loans or a combination of both? After some bluster about how secure Freddie Mac and Fannie Mae were, step in the government has indeed done. Treasury's recent actions t...
WASHINGTON - Government-controlled mortgage giant Freddie Mac has requested $6 billion in additional aid after posting a wider loss in the third quarter. Freddie Mac said Thursday that it lost $6 billion, or $1.86 per share, in the July-September quarter. That compares with a loss of $4.1 billion, or $1.25 a share, in the same quarter of 2010.
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