Financial bailout may cost about $87 billion

The cost of the financial bailout could wind up as low as $87 billion or 1 percent of gross domestic product, meaning a lower federal debt and deficit.

Treasury Secretary Tim Geithner made the estimate in a letter Friday to Congressional leaders. 

"Democrats took the necessary action to ensure taxpayers are paid back the TARP money after Congressional Republicans and the Bush administration drove our country into an economic ditch, while siding with Wall Street and big banks," said Nadeam Elshami, a senior aide for Speaker Nancy Pelosi (D-Calif.).

Geithner said the administration is trying to wind down the Troubled Asset Relief Program. The Treasury has collected $185 billion in TARP investments and generated more than $19 billion for taxpayers, according to the letter. 

As recently as a year ago, officials had estimated that the $700 billion could cost as much as $500 billion or 3.5 percent of GDP. But companies have been gradually repaying the loans. 

Fannie Mae and Freddie Mac, the government-controlled mortgage companies, are expected to have the biggest negative effect on the bottom line.