Reuters – Freddie Mac, the second largest provider of U.S. home mortgage funding, on Friday posted its first quarterly profit in two years as gains from hedges and a one-time accounting change offset still-lofty credit losses.

For the first quarter in four, Freddie Mac said it would not need a capital injection from the Treasury to maintain its business of providing credit for U.S. housing. But it continues to rely on the government for survival, it said.

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Tags: accounting, capital injection, credit-losses, first quarter, fre, freddie-mac, hedges, home mortgage, quarterly profit, reuters, survival, treasury, u-s-home

Star News Online- Dozens of hedge funds, private equity groups and other investors have plunged into the beaten-down mortgage market in recent months, buying tens of thousands of distressed loans and foreclosed properties around the country. They hope to profit from the woes of banks and other investors holding mortgages that have plummeted in value as home values sink and defaults soar.

They are buying them from Wall Street investment banks eager to rid themselves of bad assets. Merrill Lynch & Co., for example, said this week it would sell mortgage-linked investments once valued at $30.6 billion for just $6.7 billion to Lone Star Funds, a distressed-debt investor in Dallas.

Many of the hedge funds, run by former Wall Street and lending industry executives, claim they can do a better job than banks or other investors of modifying mortgages at terms that consumers can afford.

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Tags: bad-credit, boom-days, complexity, conventional-wisdom, dislocations, fund-managers, income-tax-credits, journalism, losses, mortgage-lenders, newcastle, pergam-finance, quarter-results, u-s-home