Fannie, Freddie to buy more subprime mortgages

October 13, 2008 11:26AM

The Federal Housing Finance Agency has told Fannie Mae and Freddie Mac to
start increasing their purchases of loans and mortgage-backed securities.
Fannie and Freddie will start buying $40 billion in underperforming mortgage
bonds per month, as the U.S.
government expands its options to remove troubled assets from the financial
markets. The companies each need to buy $20 billion a month in mostly subprime,
non-performing mortgage securities. The purchases are separate from the
Treasury’s $700 billion bailout plan.


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