This type of behavior at some point contributed to the fresh companies’ substantial losses, but all of this occurred too late is an initial reason for the new homes drama.
step three. As to the reasons did Fannie and you will Freddie wanted a taxpayer bailout?
Fannie and you will Freddie failed when you look at the higher region because they generated crappy business behavior and you will held diminished resource. In addition to, in the place of really personal money enterprises, Fannie and you may Freddie got only one occupation-home-based home loan money-and thus didn’t have most other types of income to pay when home prices started initially to slide.
During the 2008 Fannie and Freddie lost a mixed $47 million within solitary-family members financial companies, pressuring the companies in order to search deep in their financial support supplies.
Read moreA recent study in the Government Set-aside Financial of St
