For the CEO of Fannie Mae, the housing crisis is only halfway through. In fact, in a meeting with shareholders, President Daniel Mudd stated that home prices are likely to decline further, by as much as 25 percent.
But Fannie Mae, the biggest guarantor and buyer of mortgages in the United States, is confident that they could handle this problem and even expand its mortgage business in the near future.
As this shareholders’ meeting was taking place in New Orleans, a Senate panel okayed a controversial homeowner rescue program, believed to be worth $300 billion. The said program involved providing as many as 500,000 distressed homeowners with less expensive government-backed mortgage loans. Also, the rescue plan will look into the reform of both Freddie Mac and Fannie Mae.
Even if this reform program is approved, Fannie Mae is expecting to suffer more losses as millions of mortgages are still expected to default until next year. For the first quarter of 2008, the mortgage company has already posted $2.2 billion in losses, causing it to cut dividends and raise $7 billion in fresh capital. The federal government even decided to loosen capital requirements for both Freddie Mac and Fannie Mae in order to boost their roles in the struggling housing market.
As of Tuesday, Fannie Mae shares declined by about 4 percent to $27.75 while Freddie Mac shares went down by 50 centavos, to $26.51.
With the housing crisis still enduring, buyers should understand that current market conditions come with amazing investment opportunities. With the millions of foreclosure properties for sale in the market today, the chance to own a real estate property at bargain price is possible! All buyers need to do is subscribe to reliable foreclosure listings from reputable brokers like Foreclosure Listings Nationwide and they will enjoy hot leads!
Take a look at our Foreclosure Listings in:
Comments on this entry are closed.