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Freddie Mac Loans Facing Foreclosed Home Auctions Jump

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By : John Cutts    99 or more times read
The Federal Home Loan Mortgage Corp. or Freddie Mac, a government-sponsored mortgage lending company, reported that the number of its loan delinquencies facing foreclosed home auctions rose sharply in July.

It also reported that its loan investment portfolio was reduced to an annualized rate of 44.5 percent last month.

In its July volume summary, Freddie Mac stated that its portfolio of loan investments declined in value to $799.1 billion, with an annualized rate drop of 1.2 on a year-to-date basis. However, the portfolio size remained unchanged if based on year-over-year period, with last year same month's portfolio totaling $798.2 billion.

Earlier this month Freddie Mac announced an unexpected second quarter profit and indicated that additional federal aid may not be needed for now.

Meanwhile, delinquencies on loans guaranteed by Freddie Mac rose by 2.95 in July compared with 2.78 percent the previous month and 1.01 percent for the same month last year.

Additionally, the delinquency rate on multifamily home loans remained stable at 0.11 percent last month, compared with 0.03 percent for the same month last year.

The volume of Freddie Mac's refinance-loan purchase declined to $34.1 billion from $50.9 billion the previous month.

On the other hand, purchase and sales deals entered by Freddie Mac for its mortgage-related investments generated a net amount of $11.0 billion, higher from last month's $9.9 million.

Also in July, Freddie Mac's total mortgage portfolio dropped by an annualized rate of 3.3 percent to almost $2.234 trillion. Year-to-date showed an annualized increase of 2.1 percent.

In September 2008, the federal government took control of Freddie Mac and its sister company, Federal National Mortgage Association or Fannie Mae following heightened concerns about reduced capital at congressionally chartered companies.

An agreement with the Department of Treasury required both government-controlled enterprises to retain a $900-billion-capped portfolio until December 31 of this year. By January 1, the portfolio will start to decline by 10 percent annually until such time that it reach $250 billion.

According to industry experts, the Obama Administration is relying on Freddie Mac and Fannie Mae to help it on its campaign to stimulate the recovery of the housing market in the country by purchasing more mortgage loans, boost refinancing and help distressed homeowners avoid foreclosures.
John Cutts has been educated in the finer points of the foreclosure market over 5 years.

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