The Federal Home Loan Mortgage Corporation ("Freddie Mac") NYSE: FRE is a stockholder-owned, publicly-traded company chartered by the United States federal government in 1970 to purchase mortgages and related securities, and then issue securities and bonds in financial markets backed by those mortgages in secondary markets. Freddie Mac, like its competitor Fannie Mae is regulated by the Office of Federal Housing Enterprise Oversight (OFHEO) in the United States Department of Housing and Urban Development.


Freddie Mac makes money by charging a guarantee fee which is usually a small part of the interest payment of the loans they have securitized into bonds. (For example, Freddie Mac may purchase a loan with a rate of 5.19 percent and put it into a mortgage backed security (MBS) bond which has a 5.0 percent coupon, keeping 0.19 percent as the guarantee fee.)


Investors, or purchasers of Freddie Mac MBS, are willing to let Freddie Mac keep this fee in exchange for Freddie's guarantee that the principal of the underlying loan will be paid back according to the loan's payment schedule. This is how Freddie Mac began making money at its inception and continues to do so today. But today, the majority of Freddie Mac's income is derived from the interest rate difference in the corporate debt Freddie Mac issues and the MBS that Freddie Mac's retained portfolio purchases.

They are to busy blaming Bush because that's what the media tells them.
The sad thing is the level of Democrat involvement in the whole thing and the monies they have received from these entities. This whole thing stinks and a whole lot of it smells like rotten, crooked Democrats.
I really hope the conservative republicans block the bail out and let these companies fail.

Looks like they are on their knees again axing da gubbamint for more bailout money,lol.

Let em all fail, and go to hell.