Freddie Mac asks for $1.8B more

Freddie Mac, the U.S. government-controlled buyer of mortgages, said Monday it has asked Washington for $1.8 billion US more in federal aid after losing more money in the second quarter.

Freddie Mac, also known as the Federal Home Loan Mortgage Corporation, said it lost $6 billion, or $1.85 per share, in the three months ending in the June period.

The company is required to pay a 10 per cent annual dividend to the Treasury Department on money it has received from the government. That made up $1.3 billion of the company's second-quarter losses.

The company lost $840 million, or 26 cents a share, in the same quarter last year.

The government rescued Freddie Mac and sibling company Fannie Mae from the brink of failure nearly two years ago.

The new request means that, taken together, they have needed $148.2 billion to stay afloat.

Both lost money from the bad home loans they backed, many of them before the U.S. housing market went bust in 2008.

Fannie and Freddie own or guarantee about half of all U.S. mortgages, or nearly 31 million home loans worth more than $5 trillion. They buy home loans from lenders, package them into bonds with a guarantee against default and sell them to investors.

During the housing boom, Fannie and Freddie faced political pressure to expand homeownership and competitive pressure from Wall Street to back ever-riskier loans.

When the market went bust, defaults and foreclosures piled up, and the government had to take them over.