Reporting a $1.2 billion second-quarter loss on Thursday, mortgage bigwig Fannie Mae has sought $1.5 billion aid from the US Treasury Department. With the loss being the company’s smallest quarterly loss in the last three years, the government aid sought by the company is apparently less than what was being expected.

Fannie Mae, which - along with Freddie Mac - provides funding for almost 90 percent of home loans being issued in the country, had lost $11.5 billion loss in the 2010 first quarter; and $14.8 billion in the second quarter last year.

In addition, Fannie’s latest quarterly net loss attributable to common stockholders was $3.1 billion, or 55 cents per share, as against the same quarter year before figures of a loss of $15.2 billion, or $2.67 per share.

With the 2010 second quarter results leaving Fannie with a negative net worth of $1.4 billion at the end of June, Fannie’s regulator, the Federal Housing Finance Agency, has asked for $1.5 billion from the Treasury for eliminating the deficit.

Noting that Fannie’s narrower-than-expected loss is a rare positive for the struggling housing market, analysts say that the company’s quarterly figures will help the Obama administration in tackling reform.

Commenting on the results, FTN Financial Jim Vogel said: “For more than a year, Treasury secretary Timothy Geithner has been asking for patience on housing finance reform so that the discussions don’t disturb the fragile state of the mortgage market. This is the first big step towards that stability.”