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Cost of Seizing Fannie and Freddie Surges for Taxpayers

Posted By admin On June 20, 2010 @ 5:57 am In Money Watch | Comments Disabled

NY Times [1]
June 20, 2010

CASA GRANDE, Ariz. — Fannie Mae and Freddie Mac took over a foreclosed home roughly every 90 seconds during the first three months of the year. They owned 163,828 houses at the end of March, a virtual city with more houses than Seattle. The mortgage finance companies, created by Congress to help Americans buy homes, have become two of the nation’s largest landlords.

Bill Bridwell, a real estate agent in the desert south of Phoenix, is among the thousands of agents hired nationwide by the companies to sell those foreclosures, recouping some of the money that borrowers failed to repay. In a good week, he sells 20 homes and Fannie sends another 20 listings his way.

“We’re all working for the government now,” said Mr. Bridwell on a recent sun-baked morning, steering a Hummer through subdivisions laid out like circuit boards on the desert floor.

For all the focus on the historic federal rescue of the banking industry, it is the government’s decision to seize Fannie Mae and Freddie Mac in September 2008 that is likely to cost taxpayers the most money. So far the tab stands at $145.9 billion, and it grows with every foreclosure of a three-bedroom home with a two-car garage one hour from Phoenix. The Congressional Budget Office predicts that the final bill could reach $389 billion [2].

Full article here [1]

Cost of Seizing Fannie and Freddie Surges for Taxpayers 150410banner7 [3]

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URLs in this post:

[1] NY Times: http://www.nytimes.com/2010/06/20/business/20foreclose.html?hp

[2] reach $389 billion: http://www.cbo.gov/ftpdocs/108xx/doc10878/01-13-FannieFreddie.pdf

[3] Image: http://www.homegain.com/housead/homes_for_sale/index?entryid=11502

[4] Fannie and Freddie tab is $146B and rising: http://www.prisonplanet.com/fannie-and-freddie-tab-is-146b-and-rising.html

[5] True Cost of Fannie, Freddie Bailouts: $317 Billion, CBO Says: http://www.prisonplanet.com/true-cost-of-fannie-freddie-bailouts-317-billion-cbo-says.html

[6] Fannie & Freddie Would Need Another $100 Billion From Taxpayers For Obama’s Proposed Mortgage Writedown: http://www.prisonplanet.com/fannie-freddie-would-need-another-100-billion-from-taxpayers-for-obamas-proposed-mortgage-writedown.html

[7] Fannie, Freddie Slump on Concern Treasury Bailout Is Inevitable: http://www.prisonplanet.com/fannie-freddie-slump-on-concern-treasury-bailout-is-inevitable.html

[8] Fannie-Freddie Fix at $160 Billion With $1 Trillion Worst Case: http://www.prisonplanet.com/fannie-freddie-fix-at-160-billion-with-1-trillion-worst-case.html

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