First National Mortgage How Is The Sub-prime Loan Debacle Effecting National Mortgage Companies Like Fannie Mae And Freddie Mac?

How is the sub-prime loan debacle effecting national mortgage companies like Fannie Mae and Freddie Mac? - first national mortgage

Technically, neither Fannie Mae or Freddie Mac to buy sub-prime loans. Therefore, they can not directly affect both the companies.

However, by the failure of the Assembly were of poor quality loans affected than their purchases. Contrary to what many think, that not all problems existing mortgage with a high risk. Many companies have been through the growing defaults on so-called "Alt-A mortgages, which is of better quality than those affected are at high risk, but lower quality than the first.

Fannie Mae had to allocate funds to cover the mortgage. They had also to raise additional capital by issuing new cut and the preferred stock dividend.