Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Fannie Mae narrows loss, but asks for more aid

By David Goldman, staff writer


NEW YORK (CNNMoney.com) -- Fannie Mae says that its financial condition has vastly improved over previous quarters, but the mortgage finance company still requested more government assistance.

The government-run company said Thursday it lost $1.2 billion in the second quarter, down significantly from an $11.5 billion loss in the prior quarter. Last quarter's loss was the smallest since the government took Fannie Mae and Freddie Mac into conservatorship in September 2008.

Fannie said it continues to suffer credit losses from home loans issued between 2005 and 2008. Although those losses will continue in the future, the company said it believes it has reserved enough "for the substantial majority of these losses."

That didn't stop Fannie from asking for another $1.5 billion in government aid. The Treasury Department has given the company a total of $85 billion over the past two years. But those loans are expensive, carrying a hefty interest rate that forced Fannie to pay $1.9 billion back to the Treasury last quarter.

The company said the loans it is currently purchasing are subject to much higher underwriting standards than the ones of the past several years, carrying the lowest early "serious" delinquency rates in a decade.

"We are focused on sustainable homeownership, and our higher underwriting and eligibility standards reflect that," said Mike Williams, Fannie Mae's chief executive, in a statement. "Across our industry, we are seeing a more realistic approach to housing and lending that bodes well for the future." To top of page


Overnight Avg Rate Latest Change Last Week
30 yr fixed3.64%3.64%
15 yr fixed2.76%2.76%
5/1 ARM2.90%2.95%
30 yr refi3.66%3.69%
15 yr refi2.79%2.81%
Rate data provided
by Bankrate.com
View rates in your area
 
Find personalized rates:
Index Last Change % Change
Dow 17,873.22 44.93 0.25%
Nasdaq 4,933.51 31.74 0.65%
S&P 500 2,099.06 8.96 0.43%
Treasuries 1.85 0.03 1.54%
Data as of 8:26am ET
Company Price Change % Change
Bank of America Corp... 14.88 0.18 1.22%
Coca-Cola Enterprise... 51.55 0.69 1.36%
Baxalta Inc 45.53 -0.17 -0.37%
Apple Inc 100.35 -0.06 -0.06%
Micron Technology In... 12.31 0.36 3.01%
Data as of May 27

Sections

Janet Yellen hinted again Friday that a June or July interest rate hike is a very real possibility. More

The FBI has opened a national security investigation into the hacking of Bangladesh's central bank amid signs that the hack might have come from North Korea. More

The gender pay gap in the labor market is pretty well documented. But the gender gap also exists in the housing market. More