Jobs | Job opportunities | Job Search Strategie – Interview Tips and writing a winning CV

All real estate investors can expect bad news regarding this 4th quarter of 2009 after Freddie and Fannie requested a $400 billion ceiling in their credit pool.

Let me be clear, this was nothing more than the Obama administration preventing even more confusion and frustration about the government corporations who received more bailout money than any other corporation, due in total to its close relationships with sitting senators and congressmen, no doubt.

With Fannie and Freddie quietly failing and requiring more money, the failure of government to manage the housing market has never been so apparent. As home loan defaults continue to skyrocket, Fannie and Freddie each noted in public disclosures that the governments actions take to bailout of the real estate market will cost taxpayers more in the end.

But by lifting their credit lifelines, Congress avoided yet another bailout for Fannie and Freddie from an already embattled, bailout-happy Congress.

Consequently, even more tax payer dollars will go to the undeserved executive bonuses that the leaders of Fannie and Freddie will receive, since they got their bailout money before the initial pay guidelines were in place, and the increase in available credit does technically constitute a bailout.

Unlike Citigroup, Bank of America, AIG, Chrysler, and GM, Congress deemed that Fannie Mae and Freddie Mac had not received “exceptional assistance” and therefore did not have to have their pay decisions scrutinized by the pay czar.

Top executives of Fannie and Freddie could get paid as much as $6 million for 2009, despite the companies’ horrendous performances this year.

In 2009 the credit lines for each of them were already increased from $100 billion to over $200 billion, and now they are requesting to have that amount doubled again to total more than $800 billion, which is backed only by our governments willingness to pay the interest, with taxpayer dollars. With a combined total of over 100 billion of our taxpayer dollars already doled out to Fannie and Freddie, the government simply allows more money for them.

Typically they buy mortgages from banks and bundle them for re-sale to investors who desire the yield indicated. Together, they own or guarantee almost 31 million home loans worth about $5.5 trillion, or about half of all mortgages, reports indicate. Add in the 100’s of billions of dollars in securitizations remaining to be included in their balance sheets and you can see just how bleak things are for tax payers.

Under the Treasury’s new flexible financing formula, Fannie and Freddie get more taxpayer support based on a formula that takes into account how much each company loses in a quarter. Given President Obama’s efforts to stabilize the housing market and stop the slide in housing prices, even with Fannie and Freddie under conservatorship, they have been touted to promote the failed policies pushed by the government.

As a taxpayer, you are left to wonder why all of your money is being spent on a secret bailout for federal corporations whose portfolios only continue to decline in value, by our President whose plans to stop or slow foreclosure have been an abject failure.

The author enjoys writing articles about boise real estate & homes for sale in boise idaho. To learn more about these topics click on the links above!