Quote:
Originally Posted by lendaddy
A CNCBC article I just read said Fannie and Freddie started gobbling up sub-prime between 2003 and 2006.
"By Reuters | 16 Aug 2007 | 10:55 AM ET
Font size:
Fannie Mae [FNM 0.5 -0.11 (-18.03%) ], the nation's largest source of home loan funding, increased its holdings of risky subprime loans in 2006 while its profits fell that year, the company said Thursday in a long-delayed report.
As the U.S. volume of higher-risk subprime loans increased from 2003 through mid-2006, Fannie Mae said its "purchase and securitization of loans that pose a higher credit risk ... also increased." It added that its holdings increased to a lesser degree than many other institutions. "
|
Yes - the securitization of these loans by these agencies is a real pissoff. Despite being relatively insignificant/immaterial to their portfolio, it is still evidence of straying from their charter and completely irresponsible. They should not have gotten involved at all, even at this minute level. Their current problems are not related to subprime, however.