BEIJING, Dec. 12 (Xinhuanet) -- A weakening housing market and rising home-loan defaults have the chief executives of Fannie Mae and Freddie Mac warning their hard-hit mortgage-finance companies will suffer more in 2008.

    Freddie's CEO, Richard Syron, said the government-sponsored company could lose an additional 5.5 billion U.S. dollars to 7.5 billion dollars during the next few years from soured home loans.

    "I honestly think it's going to get tougher before it gets better," Syron said in a discussion with financial analysts in New York. His company has already logged about 4.5 billion dollars in projected losses during the first nine months of this year.

    Fannie CEO Daniel Mudd, also meeting with analysts at the conference, forecast "a very tough 2008" and continued weakness in home prices through 2009. Mudd called the wave of defaults and foreclosures this year the worst mortgage crisis "in recent memory."

    The Washington-based company, which lost 1.4 billion dollars in the third quarter, sold 7 billion dollars in preferred stock last week to raise capital to shore up its finances. Mudd said Tuesday that Fannie had no further plans for such sales over the next year.

    Mudd said the company could raise additional capital, however, through sales of mortgage investment holdings, increased fees on mortgages and other measures.

    The chief executives' remarks came a day after Freddie and Fannie said they would change their criteria for purchasing delinquent home loans they've guaranteed, in order to reduce the number they buy from investors.

    Fannie and Freddie, which together own or guarantee around two-fifths of U.S. home-mortgage debt, have cut their dividends and sold billions of dollars of special stock recently to buttress their finances after posting stunning third-quarter losses. They have been forced to set aside billions of extra dollars to account for bad home loans, eroding their profits at a time when home prices are falling and defaults are spiking on high-risk mortgages made to borrowers with weak credit histories.

    (Agencies)