Freddie Mac – Potential Large Wave of Foreclosures in 2010

Freddie Mac Releases Fourth Quarter and Full-Year 2009 Financial Results

Summary

  • Fourth quarter 2009 net loss was $6.5 billion. After the dividend payment of $1.3 billion to the U.S. Department of the Treasury (Treasury) on the senior preferred stock, net loss attributable to common stockholders was $7.8 billion, or $2.39 per diluted common share, for the fourth quarter of 2009.
    • Fourth quarter results reflect net interest income of $4.5 billion, a write-down of $3.4 billion of the carrying value of the company’s Low-Income Housing Tax Credit (LIHTC) partnership investments and credit-related expenses of $7.1 billion.
  • Full-year 2009 net loss was $21.6 billion. After dividend payments of $4.1 billion during the year to Treasury on the senior preferred stock, net loss attributable to common stockholders was $25.7 billion, or $7.89 per diluted common share, for the full-year 2009.
  • Net worth at December 31, 2009 was $4.4 billion. As a result of the positive net worth, no additional funding from Treasury was required under the terms of the Senior Preferred Stock Purchase Agreement (Purchase Agreement) for the fourth quarter.
  • In 2009, Freddie Mac played a critical role in supporting the nation’s housing market by:
    • Providing $548.4 billion of liquidity to the mortgage market, helping finance approximately 2.2 million conforming single-family loans and approximately 253,000 units of multifamily rental housing.
    • Helping more than 272,000 borrowers stay in their homes or sell their properties through the company’s long-standing foreclosure avoidance programs and the Home Affordable Modification program (HAMP), including 129,380 loans that remained in HAMP trial periods as of December 31, 2009 according to information provided by the Making Home Affordable (MHA) program administrator.
    • Refinancing approximately $379 billion of single-family loans, creating an estimated $4.5 billion in annual interest savings for borrowers nationwide – this includes approximately 169,000 borrowers whose payments were reduced by an average of $2,000 annually under the Freddie Mac Relief Refinance MortgageSM.

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