Oops, Fannie and Freddie Did It Again: They Deny Buying Subprime Loans While Having a 30% Subprime Market Share
|March 7, 2002|
FM Watch: This is a classic example of Fannie and Freddie's habit of speaking out of both sides of their mouths
WASHINGTON D.C -- Fannie Mae and Freddie Mac are both denying and leading the subprime market. According to data from last year compiled by National Mortgage News, Fannie Mae bought $13.3 billion in subprime loans last year, more than any other lender. Freddie Mac purchased approximately $7.5 billion, making it second only to Fannie.
FM Watch released a report last month, Fannie Mae and Freddie Mac: Failing the American Dream in the Nation's Cities, that analyzed HUD's HMDA data. The data showed that Fannie Mae and Freddie Mac are actually lagging private institutions in serving minority homebuyers in 97 of the 100 top African- American markets, and 87 of the 100 top Hispanic markets. The only loans included in the survey were conventional, conforming home purchase loans. Typically, 11% of such loans can be considered subprime.
By way of rebuttal, Fannie Mae and Freddie Mac offered the following:
"This is a classic example of Fannie and Freddie's habit of speaking out of both sides of their mouths," said FM Watch Executive Director Mike House. "When they can't justify their failure to lead the market in serving minority and low income families, they resort to distorting their facts. It's time for Congress to strengthen oversight of the GSEs -- someone should be holding them accountable."
Source: FM Watch