Guess what America? We just bailed out Bank of America yet again. This time, it wasn't as apparent as TARP. Instead, this bailout is being called a backdoor bailout. It seems that Fannie Mae, which is tax-payer owned, just purchased more mortgages from Bank of America.
Per CNN:
n short, purchasing these servicing rights was another Troubled Asset Relief Program.
At a time when austerity measures are being discussed, and Americans both young and old are being screwed, we are bailing out the zombie Bank of America again. Jump below for more.
Fannie Mae didn't get a good deal here. In fact, they (i.e. taxpayers) purchased a block of mortgage securities with a delinquency rate of 13%. CNN suggests it may actually be worse than that:
Fannie Mae is purchasing "the servicing rights in order to transfer the day-to-day management of those loans to a different company." That's another huge sign that Fannie Mae is overpaying. If the rights were really worth $500 million, wouldn't a private company pay that for them? Instead, it sounds like Fannie Mae is doing a bailout two-step, one to BofA and one to whomever takes these rights off Fannie Mae's hands.
This backdoor bailout comes on the heels of Fannie Mae asking for its own bailout of $5.1 billion just last week. Does anyone see a problem with this besides me? This is absolutely a disgrace! Bank of America should be forced to shed assets at its own cost rather than taxpayer costs. What really irritates me is this was done so the American public won't really know it even happened. If we called it TARP #2 for BofA, then there would be public outrage, but doing it this way, most people won't notice.
What does this all mean for taxpayers?
And taxpayers? Well, we get to own yet another good chunk of BofA's mess.
This is an outrage. I'm in the process of closing all of my Bank of America accounts and they aren't making it easy at all. I will be glad when I am done with this awful company once and for all.