Modest improvements for Fannie, Freddie as bailout tab decreases

Fannie Mae has received $104 billion in bailouts

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A federal regulator has downgraded the bailout tab for government-sponsored Fannie Mae and Freddie Mac to $124 billion from $154 billion through 2014. The taxpayers have already paid Fannie and Freddie a combined $141 billion, but the latest numbers show that the cost is shrinking as the mortgage giants begin to repay the money. According to the Wall Street Journal, the numbers show modest progress — the companies are stabilizing, but they aren’t yet returning to profitability in the foreseeable future. All profits go towards paying the government 10 percent dividends on the bailout payments. Under a more severe economic scenario, the bailout bill could amount to $193 billion — down from last year’s estimate of $259 billion. Fannie and Freddie own or guarantee about half of the US’ $10.4 trillion in mortgages. [WSJ]