The Real Estate Bloggers

Freddie Mac And Fannie Mae Debt is Downgraded by Standard and Poor

Posted: 08 Aug 2011 10:10 AM PDT

Freddie_mac The ramifications of the downgrade of the federal debt has crept into the housing market as Freddie Mac and Fannie Mae have seen their debt downgraded from AAA to AA+.

The reason given was the reliance of the debt on the United States government.

This mess is going to have ramifications on all aspects of our economy. To use a housing term our country is “upside down” now and needs to be righted.

From the S&P press release:

Ratings On Select GREs And FDIC- And NCUA-Guaranteed Debt Lowered After Sovereign Downgrade
On Aug. 5, 2011, Standard & Poor’s lowered its long-term sovereign credit rating on the United States of America to ‘AA+’ from ‘AAA’.
As a result, we have also lowered the long-term issuer credit ratings and related issue ratings on select government-related entities (GREs) to ‘AA+’ from ‘AAA’.
The issuer credit ratings of these financial institutions and their relevant debt issues are removed from CreditWatch, where they were placed July 15, 2011.
The outlooks for all 12 FHLBs, and the issue level ratings for Fannie Mae, Freddie Mac, the FHLB System, and the Farm Credit System are negative.

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Freddie Mac And Fannie Mae Debt is Downgraded by Standard and Poor