U.S. acts to rescue mortgage firms

By Cecilia Brabin | November 22, 2017

Jul 14 – The U.S. government has announced sweeping measures to shore up the country’s two largest mortgage financing giants, Fanny Mae and Freddie Mac.

The plan calls on Congress to increase the companies’ access to credit and allow the Treasury to purchase shares in the companies if needed.

The Federal Reserve also announced that it would lend emergency funds to the troubled mortgage finance giants if needed in a move that echoed the Fed’s efforts to rescue investment Bank Bear Stearns in March.

Shares in the two companies plunged last week after fears that they might run out of money amid mounting home-loan losses.

Helen Long reports.

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U.S. acts to rescue mortgage firms

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  1. The US treasury is letting the 2 finance giants solve their own problems.
  2. The two organisations have run out of money.
  3. The US housing market is experiencing its biggest slump ever.
  4. Fanny Mae and Freddy Mac are large financial institutions.
  5. The 2 companies are owned by the government.
  6. The Federal Reserve has not lent emergency funds since the Depression.
  7. These measures are only going to help for a little while.
  8. The companies buy mortgages for the banks.
  9. Together they manage over $3 trillion.
  10. Fanny Mae and Freddy Mac are the names of their founders.

 

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