U.S. to Lose $400 Billion on Fannie, Freddie, Wallison Says

"Dec. 31 (Bloomberg) – Taxpayer losses from supporting Fannie Mae and Freddie Mac will top $400 billion, according to Peter Wallison, a former general counsel at the Treasury who is now a fellow at the American Enterprise Institute.

“The situation is they are losing gobs of money, up to $400 billion in mortgages,” Wallison said in a Bloomberg Television interview. The Treasury Department recognized last week that losses will be more than $400 billion when it raised its limit on federal support for the two government-sponsored enterprises, he said. "


The real irony of it is that Fannie and Freddie are still buying junk loans. Right now, there are very few prime home loans being made. People are staying put. But the “first time homebuyers” and the other subsidized, overpriced, “look the other way” loans are being made aplenty.

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