Something that is so bad that two wordsindicating how bad it is have to be combined together.
An item, person, or event that fails so hard that calling it retarded would be a complement.
Last night's party was fucking failtarded. There was one girl, she was fat, and some dude grabbed my butt. Not to mention someone ran off with a bottle of Goose.
When faith is so cruel that it pwns you with the amount of fail that it provides given the circumstances. In other words, a massive fail that marks you for the rest of your life. The ultimate self-embarrassment.
Example 1: Masturbating in front of your laptop when you've forgotten the webcam on after speaking to your grandparents in Florida would be failage.
Example 2: Letting the girl you have a crush on download a torrent using your PC without thinking of deleting or hiding the collection of BDSM porn first would be an even bigger failage.