Fannie Mae Wants The American Taxpayers To Hand Over Another $5 billion

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Fannie Mae reported a second quarter loss of $2.9 billion in 2011. The first quarter loss was a huge $6.5 billion. The second quarter loss for 2010 was ONLY $1.2 billion. So it seems that the situation is getting worse when it should be better.

Fannie explained the losses this way. "The housing market is still weak". "Unemployment is high. The national average is 9.1%". "House values continue to fall". If Fannie were an employee at any company in America she would be fired. This $5 billion would bring the total given to Fannie Mae to $104.8 billion.

This is a lot of money to be wasted. You could take 2 million families in the United States and give each family $50,000.

On the bright side in the second quarter Fannie Mae did about 80,000 loan workouts. She also closed 59,000 permanent loan modifications and over 21,000 short sales. So there were over 100,000 houses that escaped foreclosure.

But what about the REO portfolio of Fannie Mae? This portfolio of houses is valued at over $12.5 billion. The houses are marketed and sold through HomePath. These are assets that are not generating adequate income and have become a drain on the cashflow of Fannie Mae.

Maybe it is time for a yard sale. Let's get some cash for these houses. Fifty cents on the dollar is better than throwing another $5 billion at Fannie Mae.

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