Mortgage market now almost entirely federal government owned

Since the mortgage market imploded in 2007, the government has dramatically expanded its support of the housing market. You might think that the so-called recovery would change that, and the private sector would start taking some of the mortgage market back from the federal government. You would be wrong.

Government-related entities backed 96.5% of all home loans during the first quarter, up from 90% in 2009, according to Inside Mortgage Finance. The increase was driven by a jump in the share of loans backed by Fannie Mae and Freddie Mac, the government-owned housing-finance giants.
By providing a steady source of liquidity to the mortgage market, the government has helped housing markets to stabilize. However, "Fannie and Freddie have to get smaller and less relevant in order to revamp them, and instead, every day they're getting bigger and bigger and bigger," said Paul Bossidy, chief executive of Clayton Holdings LLC, a mortgage analytics firm.

Subject Meta: 

Forum Categories: 

yoozer, we need a huge overview post on Fannie/Freddie

and how it's worse than TARP ever was. This is completely out of the press and the blogs. I also don't think most people, including financial/economics bloggers, understand it or even realize how much gov. bail out is going to these two entities or how the U.S. government now is responsible and subsidizing the entire residential mortgage/housing market.

You must have Javascript enabled to use this form.