Fannie Mae and Freddie Mac - in some trouble again
This is not widely publicized, but Fannie Mae is asking for an additional $15 billion in government aid after posting a $19.8 billion loss. Fannie Mae and Freddie Mac own or guarantee almost 31 million home loans worth about $5.5 trillion, or about half of all mortgages.
The Federal Housing Administration (FHA), another government agency, is heading for the same kind of financial trouble. The FHA has insured about 1 out of 4 new loans made this year. 17% of FHA borrowers are at least one payment behind, or in foreclosure.
The short sale solution is one many are considering given the status of the real economy. Short sale relief is how most home owners are finding a solution to the money crunch.
Keep in mind that Fannie, Freddie, and the FHA are struggling despite the third quarter being the best quarter for real estate prices in quite a while.
Of course, large housing agencies are just reflecting what's happening throughout the country. Median home sales prices declined in 123 out of 153 metropolitan areas year-over year, or 11%.
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