Is Freddie Mac Betting Against Homeowners?
In a surprising story that came to light just last week on npr.org, National Public Radio (NPR) shared the results of its investigation, conducted along with ProPublica, on mortgage company Freddie Mac. The findings of the investigation revealed that Freddie Mae has been, as recently as 2011, utilizing complex mortgage securities that generated more money for the taxpayer-owned agency whenever homeowners were unable to qualify for new loans with lower interest rated.
Defying their mission?
While it’s important to note that Freddie Mac’s investments are legal, they do appear to be working against homeowners and especially those which are struggling to pay their existing mortgages. And according to Freddie Mac’s website, the company’s mission is to “stabilize the nation’s residential mortgage markets and expand opportunities for homeownership”.
Given the information presented, there are now concerns about Freddie Mac’s investment activity being a conflict of interest. That is, they are essentially betting against struggling homeowners when they are supposed to be looking out for their best interests.
Your turn to weigh in
Do you feel Freddie Mac has the right to be involved with investments of this nature? Do you think anything should be done to regulate this kind of activity? We want to hear what you have to say!