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Mortgage giant Fannie Mae wants to get its hands on nearly $11 billion in government aid after it posted a huge loss for the quarter. As of right now, the only entity that has gotten more government money than Fannie Mae and its little brother Freddie Mac is AIG. AIG has received $182 billion and with the newest request from Fannie, the mortgage giants would have asked for and received $96 billion. In the last quarter, Fannie Mae posted a loss of $15.2 billion. That equates to $2.67 a share and that total includes $411 million in dividend payouts. Just last year, the company only saw a $2.6 billion loss for the same quarter.

As far as Fannie and Freddie go, the government has said that it will give the companies up to $400 billion if they simply ask because the companies guarantee or own almost half of the mortgages in the United States. They are insanely important to the mortgage market and are partly responsible for the near complete meltdown of the real estate market last year that led to the financial crisis we are in now.

The companies are responsible for 31 million mortgages that total about $5.4 trillion.

This is getting ridiculous. I mean, companies can’t just operate in the red all the time. If this were any other company, it wouldn’t even be a blip on the government’s radar. Instead, because this company was allowed to get as large as it did (and Freddie Mac is backed by the government anyway), the government has to go along and help the company out. At the same time, I do realize before these companies came about, it was much harder for everyday Americans to be able to afford homes.

Because the companies are such a drain on taxpayer dollars at this point, next year there are plans to introduce a new plan for the two mortgage owners. There are several options floating around right now, some of which include winding down operations, making them one federal agency, or taking out the bad mortgages and making the new company backed by the government.

Jeremy

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