Home Loan Delinquencies To Hit Record Totals

Analysts’ estimate that home-loan delinquencies will continue to soar through the first quarter of 2009 reaching the highest on record, adding to further fuel the deterioration of U.S. mortgage-finance giants Fannie Mae and Freddie Mac, according to Bloomberg.

Freddie Mac is projected to announce a second-quarter loss of $1.9 billion in credit-related costs, while Fannie will report $2.4 billion on Aug. 8, said Moshe Orenbuch, analyst at Credit Suisse.

The U.S. Treasury Secretary’s rescue plan for Fannie and Freddie will allow the companies to have direct loans from the Federal Reserve. Whether the bail-out will actually curtail the downward spiral of home prices and bolster the economy has yet to be seen.

Source Bloomberg.com:

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