Fannie Mae, Billion | featured news

Bank of America agreed on Monday to pay more than $10 billion to Fannie Mae to settle claims over troubled mortgages that soured during the housing crash, mostly loans issued by the bank's Countrywide Financial subsidiary.

The $1-billion civil suit alleges that BofA's Countrywide fraudulently deceived mortgage finance giants Fannie Mae and Freddie Mac into believing the company's risky loans were safe and sound.

Fannie Mae and Freddie Mac, the two mortgage-finance giants, this week reported some of their best quarterly results since the real estate collapse. On Wednesday, Fannie Mae posted second-quarter net income of $5.1 billion. That is up from $2.7 billion in the first quarter of this year and an improvement from a net loss of $2.9 billion in the second quarter of last year. Fannie requested no additional money from the Treasury and said it would pay a $2.9 billion dividend to taxpayers.

Mortgage finance giant Fannie Mae said it would ask for an additional $5.1 billion from taxpayers as it continues to suffer losses on loans made prior to 2009.