Fannie, Freddie to channel mortgage rescue: sources

Reuters on Yahoo ^ | 2/8/09 | Patrick Rucker

[NormsRevenge]

WASHINGTON (Reuters) – The Obama administration is crafting a mortgage-rescue program that would see Fannie Mae and Freddie Mac ease payments for hundreds of thousands of borrowers and offer a model for Wall Street to do the same, sources familiar with the plan said.

Late last week, officials from the Treasury Department and Department of Housing and Urban Development worked with the companies' regulator to agree on standards for who could get relief and how they might coax other finance companies to follow their lead, said two industry sources familiar with the deliberations.

Those discussions were still going on over the weekend with Treasury officials trying to weigh the merits and costs of several possible approaches, said one source familiar with the talks.

Washington's two largest foreclosure-prevention initiatives of the last 12 months have fallen flat with only a handful of borrowers having been helped despite promises that hundreds of thousands would qualify.

Officials hope to clear the red tape and rigid terms that have doomed past mortgage-aid efforts without burdening taxpayers with many billions of dollars in funding costs.

"They want to get rid of all the high-cost mortgages out there and figure that there are 1.5 million people who could stay in their homes this year if their loans were modified," said one industry source who asked for anonymity. "But it's just really complicated and expensive to do these kind of workouts."

Since Fannie Mae and Freddie Mac were nationalized in September, the government-controlled companies have been retooled as agencies for delivering housing aid. ...

But while Fannie Mae and Freddie Mac have had some success with stopgap measures to keep people in their homes, the companies' effort to rewrite home loans announced in November has been a disappointment, industry sources said.

[Mad_Tom_Rackham]

So, Freddie and Fannie are going to be guaranteeing mortgages, with Chris and Barney in charge. And THIS is change?

[2ndDivisionVet]

Let me guess: You'll have to show a union membership card, a matrícula consular, a Food Stamp card or an Obama campaign donation receipt to get a loan, right?

[avacado]

"Since Fannie Mae and Freddie Mac were nationalized in September, the government-controlled companies have been retooled as agencies for delivering housing aid... "

Lovely.

[rockinqsranch]

"The Obama administration is crafting a mortgage-rescue program that would see Fannie Mae and Freddie Mac American Taxpayer ease payments for hundreds of thousands of borrowers and offer a model for Wall Street to do the same, sources familiar with the plan said."

There, I fixed it to reflect the truth.

[Candor7]

FNM - Fannie Mae (NYSE) 6 Feb 2009

0.65 +0.13 (25.00%) Feb 6 4:00pm ET
Open: 0.54
High: 0.65
Low: 0.52
Volume: 20,972,256
Avg Vol: 16,734,000
Mkt Cap: 699.53M

***********************************

FRE - Freddie Mac (NYSE)

0.64 +0.12 (23.08%) Feb 6 4:01pm ET
Open: 0.54
High: 0.64
Low: 0.52
Volume: 12,952,752
Avg Vol: 10,501,000
Mkt Cap: 414.18M

***********************************************

I am rushing out to buy some of their stock.

[Orange1998]

Do you like the new or did you forget the sarc.

[Candor7]

Guess.

[Orange1998]

I will bite. We are talking penny stock with angel investor, possible double bagger short term (week or two). Longterm it suxs.

[Candor7]

If you do buy it, put that short term to three or four days. You will have to use serious money to make any, Say 20 grand or more.

Their stock might bounce up another buck once the stim package is passed, IF it is passed.You can get some of that tax money back. LOL.

I have decided to sleep at night instead, and am looking at commodities, ( Canadian).Small cap silver and commodities ETFs. People got to eat.

[businessprofessor]

Officials are also discussing how fresh legislation from Congress could buttress their efforts by clearing some accounting and legal hurdles that obstruct loan modifications, the sources said.

I believe this sentence refers to cram downs. Cram downs on existing mortgages are a clear violation of property rights. Cram down requirements on new mortgages will turn the mortgage industry on its head. The nice prose about "obstruct loan modifications" is double talk for asset confiscation.

[Dubya]

Thanks

[Orange1998]

USO look good here. Rogers is now saying it will rocket. I got some Fannie Friday, double bagger.

[richardtavor]

“Officials are also discussing how fresh legislation from Congress could buttress their efforts by clearing some accounting and legal hurdles that obstruct loan modifications, the sources said.” So, just do a do-over, cancel the debt, tell the people don’t worry about payment, and we will send you a few thousand to ease your pain...and banks, don’t worry about consequences—we are the government, we can do whatever the hell we want...

[Candor7]

I be rootin’ for you.

Good luck.

Make sure you sell on the uptick.

I love seeing Conservatives make out from Dem folly.

[Orange1998]

Thanks, the futures are down 1% tonight but maybe it will turn.