Posted on 10/09/2009 8:33:55 AM PDT by fiscon1
A former Fannie Mae executive warned a House panel Thursday that the Federal Housing Administration is destined for a multibillion-dollar taxpayer bailout in 24 to 36 months, an analysis that the agency’s top official immediately dismissed as “completely unfounded.”
At a hearing before a House Financial Services panel, Edward J. Pinto predicted that the FHA will suffer $40 billion in losses, leaving it unable to cover its bad loans without taxpayer help. Pinto, a real estate finance consultant who served as Fannie Mae’s chief credit officer from 1987 to 1989, said he testified so lawmakers would “not be able to say that no one told them of the magnitude of the impending losses.” …
(Excerpt) Read more at hotair.com ...
Only 40 billion? Get back with us when it gets to be real money.-—JM
I wonder how he arrived at that number. I believe there’s more than a trillion in FHA loans outstanding. I do believe that Ed misconstrues the situation. Nowhere does it say that FHA loosened its guidelines and I don’t think they have. FHA is having the same problems all other loans are having, high unemployment and lower values.
Impending losses.” …for the next three years.
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