Freddie Mac, one of the largest lenders in the United States announced today that their losses in the poor credit mortgage market are much larger than they feared. Although the poor credit mortgage market has already been experiencing the highest rate of failures, experts were not quite prepared for how bad things would get. The default rates continue to go up for poor credit mortgages and many are wondering what is needed to stop the bleeding. However, some experts were fully expecting that the poor credit mortgage market would continue to deteriorate.The result “wasn’t worse than expected and raising capital is a good thing” for growth, said Malcolm Polley, chief investment officer at Stewart Capital Advisors in Indiana, Pennsylvania. “It means Freddie’s business will be able to expand and it will be used to put some sort of backstop to this mess we are in. And, the government is behind them.”"It’s clear we have not yet hit bottom in the housing market,” Freddie Mac Chief Executive Officer Richard Syron said on a conference call. Risks to the forecast for falling home prices this year and next “are strongly weighted on the downside,” he added.
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