Mortgage Crisis May Force Government Intervention
- added July 11, 2008
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- amilli23
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Mortgage giants Fannie Mae and Freddie Mac have been hit hard by the housing crisis accumulating nearly $5 trillion in debt (half of the U.S. government). If the housing market gets worse, Fannie Mae may not have the funds to cover the debt and be forced to close.
Fannie Mae and Freddie Mac hold 52% of all mortgages. They are an organization that allows for banks to make mortgage loans at lower interest rates and lower mortgage payments. However, if Fannie Mae and Freddie Mac are forced to close monthly housing payments will go up and the price of houses will decrease greatly. This fact may very well force the government to intervene and become responsible for mortgage loans.
Fannie Mae and Freddie Mac hold 52% of all mortgages. They are an organization that allows for banks to make mortgage loans at lower interest rates and lower mortgage payments. However, if Fannie Mae and Freddie Mac are forced to close monthly housing payments will go up and the price of houses will decrease greatly. This fact may very well force the government to intervene and become responsible for mortgage loans.
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