Items of Interest:
Doubts Raised on Mortgage Agencies as Losses Mount -- As home prices continue their free fall and banks shy away from lending, Washington officials have increasingly relied on two giant mortgage companies — Fannie Mae and Freddie Mac — to keep the housing market afloat.
But with mortgage defaults and foreclosures rising, Bush administration officials, regulators and lawmakers are nervously asking whether these two companies, would-be saviors of the housing market, will soon need saving themselves.
The companies, which say fears that they might falter are baseless, have recently received broad new powers and billions of dollars of investing authority from the federal government. And as Wall Street all but abandons the mortgage business, Fannie Mae and Freddie Mac now overwhelmingly dominate it, handling more than 80 percent of all mortgages bought by investors in the first quarter of this year. That is more than double their market share in 2006.
But some financial experts worry that the companies are dangerously close to the edge, especially if home prices go through another steep decline. Their combined cushion of $83 billion — the capital that their regulator requires them to hold — underpins a colossal $5 trillion in debt and other financial commitments...
Countrywide admits mistakes, not wrongdoing -- Mortgage lender Countrywide Financial Corp., which is under investigation for inflating certain borrowers' fees, acknowledged Tuesday that it has made errors and pledged to take steps to improve its operations...
Credit expenses take toll on Fannie Mae earnings -- Mortgage-finance giant plans to raise new capital, cut dividend. Mortgage-finance giant Fannie Mae reported a much wider-than-expected first-quarter loss of $2.2 billion, as credit-related expenses took a bite out of its bottom line, and said it's planning to raise $6 billion in new capital. On a per-share basis, Fannie Mae lost $2.57 in the first quarter, much more than the 81-cents-a-share loss expected by Wall Street analysts surveyed by FactSet. In the same period a year ago, Fannie Mae earned 85 cents a share...
- Bernanke: Foreclosure woes require action - CNN Money
- Fannie Visits the Confessional - Mortgage Lender Implode-O-Meter
- How Wall St. Gravely Damaged Economy - K. Phillips, American Prospect
- Where's the U.S.'s Great Depression? - Gerard Baker, Times of London
- The Housing Crisis is Over - Cyril Moulle-Berteaux, Wall Street Journal
- NYC Foreclosure Rates Soar 34%, And Manhattan Not Immune - NYC Housing Bubble