United States News
See other United States News Articles
Title: Fannie Mae Began Buying $1,000-Down Mortgages Without Approval (More Democratic Shinanigans Setting the Nation up for another Real Estate Scandal/Bubble)
Source:
Bloomberg
URL Source: http://www.bloomberg.com/news/2010- ... ortgages-without-approval.html
Published: Sep 19, 2010
Author: Jody Shenn
Post Date: 2010-09-19 23:51:31 by Nebuchadnezzar
Keywords: None
Views: 12420
Comments: 20
Fannie Mae Began Buying $1,000-Down Mortgages Without Approval By Jody Shenn - Sep 15, 2010 2:15 PM PT Email Share Fannie Mae agreed to finance loans to homebuyers putting as little as $1,000 down without getting the approval of the U.S. agency in charge of minimizing the costs of the mortgage company’s bailout. While “any significant actions” taken by the Washington- based company and rival Freddie Mac must be “reviewed and approved” by their overseer, the Federal Housing Finance Agency, Fannie Mae began buying the so-called Affordable Advantage mortgages from state housing finance authorities without taking that step, Edward J. DeMarco, the FHFA’s acting director, said today. “This one got away from us,” DeMarco told lawmakers at a House Financial Services subcommittee hearing in Washington. Republican Representatives Spencer Bachus of Alabama and Judy Biggert of Illinois cited the loans in criticizing the government’s oversight of Fannie Mae and Freddie Mac during the hearing, which focused on the U.S.’s need to rework its mortgage-finance system and limit the costs of supporting the companies in the interim. The companies have been sustained by almost $150 billion in government aid since they were placed under U.S. conservatorship in September 2008. The U.S. is seeking to limit taxpayers’ expenses by tightening the companies’ loan standards and supporting their efforts to force lenders and securities sellers to buy back bad debt, DeMarco said. Fannie Mae is buying the Affordable Advantage loans from housing finance authorities in Massachusetts, Minnesota, Wisconsin and Idaho, Janis Smith, a spokeswoman, said today in a telephone interview. She declined to comment further. First-Time Buyers The state housing authorities last year created the loan product aimed at first-time buyers, the New York Times reported Sept. 5. The mortgages come with 30-year fixed rates, require homeownership counseling, and are available to people with credit scores of at least 680 or 720, the paper said. FHFA wouldn’t have approved Fannie Mae’s plan to buy the loans, DeMarco said. “I found that the terms of this program did not fit with what we’re trying to accomplish here in conservatorship, and that’s why you won’t be hearing about additional programs such as this,” he said. Still, the company has signed contracts to buy the loans through March, and won’t be forced to break them, DeMarco said. Fannie Mae, which along with Freddie Mac owns or guarantees about half of the $11 trillion in U.S. residential mortgage debt, has purchased only about $10 million of the low down payment loans so far, he said. Underwriting The risks posed by the homebuyers’ limited stakes in properties under the Affordable Advantage loans are offset to a degree by the company’s “recourse” to return the loans to the housing authorities if they default, DeMarco said. In addition, the loans are subject to a “great deal of underwriting,” he said. Homebuyers typically need to put at least 20 percent down to obtain Fannie and Freddie Mac loans unless they agree to buy private mortgage insurance, which is usually limited to borrowers with 5 percent down payments. The Federal Housing Administration insures loans to borrowers putting down as little as 3.5 percent. Bachus said that the loans, which he discussed today on CNBC after news reports about them, were among signs that “we’re laying the seeds for the next bubble” in housing, and inflating the costs of supporting Fannie Mae and Freddie Mac by not moving more quickly to decide their futures. Assistant Treasury Secretary Michael Barr told lawmakers it “is simply not true” that taking time to create a plan to deal with the companies is increasing taxpayers’ costs, citing the lower defaults on the mortgages they’ve financed since 2008. To contact the reporter on this story: Jody Shenn in New York at jshenn@bloomberg.net. Yawn, "I'm president Obama and I'm asleep at the switch because I don't care that I'm ruining the nation..."
Post Comment Private Reply Ignore Thread
Top • Page Up • Full Thread • Page Down • Bottom/Latest
#1. To: All (#0)
"Hi! I'm Larry Summers and I sleep in Cabinet meetings." Clinton and Cuomo are the true bandits who lit the fuse to this economic crisis we're now in. All in the name of getting more minorities in houses: http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=12554
"Hi, I'm Donna Shalalah I'm a dumb-bitch who fucked over Arizona and now I got promoted to be head of the nation's security and I fall asleep when Obama speaks..." "I mean don't wake me to tell me about all the illegal aliens infiltrating our border, I need my beauty sleep because I'm a liberal and that means I'm so fucking ugly I need all the sleep I can get"
Clinton and Cuomo are the true bandits who lit the fuse to this economic crisis we're now in. All in the name of getting more minorities in houses: http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=12554
So FNMA - a private corporation - does this on its own but it's Obama's faukt. The Real Estate bubble was caused by nonFN/FM eligible lending.
Wrong State. She's from Miami via New England (New Hampshire?). I know it's not AZ.
To keep Housing $$$ high has been the job of Fannie/Freddie since FDR (different names for same agencies;}. And the collapse has happened. We're just waiting to see how the Bottom 90% handle it. • Even before the onset of the recession, poverty was a familiar experience to one-third of all Americans. From 2004 to 2007, some 31.6 percent of the population lived in poverty for at least one period of two months or more. The Following from a Great Article: "What the charts tell us is that if present Monetary and Fiscal Policy is anything other than totally successful in arresting deflation and creating balanced inflation in both what we USE and OWN, we are in serious troubles. Any imbalances will be a disaster as shown on our charts. A failure to stop deflation will be devastating to those who are in highly leveraged assets. If after reading the former example of the Smith Family you discarded it because you strongly believe elevated inflation is around the corner and you are a highly leveraged home owner, let me take you through a brief quiz published by The Daily Bell to further test your understanding of reality: “The Great Housing Bamboozle: A Look Behind The Numbers Shows Home Ownership To Be A Horrible Investment”." http://www.philstockworld.com/2010/09/19/preserve-and-protect-the-jaws-of-death/
The first few conduits which failed were NOT Fn/FM eligible. The "crisis": was caused by overleverage. FN/FM don't use leverage.
Poverty? Come on. Most of those people have a home, car, cable TV, cell phones and a full belly. Poverty in this country would be considered rich in many many other countries.
Please, war. Don't. Congress Automatically leverages Every Credit advance 10X. At the starting gate. No Income, still. 3.5% down. And once the US took on Fannie/Freddie, the US took on $6 Trillion minimum in debt. Plus, like the Fed Res, we have No idea what the Banks have thrown into the Fannie/Feddie Garbage Pile since the Alphabet of AgencyPlans from Oct 08.
They do not leverage their portfolios. They do suffer from the over leverage of others...
A quick google of my text above brings up one of my faves: Money Matters: Much of these losses have been shuffled off to Freddie and Fannie. As well as Feddie the Reserve with no reserves! Bernanke has vacuumed up a huge dozens of ... elainemeinelsupkis.typepad.com/money_matters/.../index.html - She'll have lots of links, I'm sure.
Poverty? Come on. Most of those people have a home, car, cable TV, cell phones and a full belly. Poverty in this country would be considered rich in many many other countries. You're pulling that out of your ass, AK, and you know it. You still think the US is #1. When we're nothing but a glorified banana republic now. PEOPLE ARE STILL HURTING – IT ISN’T GETTING BETTER! A recent convention in Palm Beach Florida attracted over 50,000 people, estimated to be holding 25,000 problem mortgages. This is after the government placed Fannie and Freddie in conservatorship and bought over $1T in agency mortgages to keep the US mortgage system from imploding. http://www.philstockworld.com/2010/09/19/preserve-and-protect-the-jaws-of-death/ “If the poverty status of related subfamilies were determined by only their own income, their poverty rate would be 44.2 percent,” David Johnson, chief of the Housing and Household Economic Statistics Division at the US Census Bureau, told the Wall Street Journal. “When their poverty status is determined based on the resources of all related household members, it is about 17 percent.” The number of multifamily households increased by 11.6 percent from 2008 to 2010, and the proportion of adults 25-34 living with their parents rose from 12.7 percent in 2008 to 13.4 percent in 2010. The poverty rate for these young adults was 8.5 percent when they were considered part of their parents’ household, but would have been 43 percent if they had been living on their own.
And that 'full belly' thing. You can correct me, and I'm sure you will, but 'full belly' and Obesity aren't the same thing at all. And Obesity is a form of starvation. Details on demand. ;}
From Article: Phil'sStockWorld above: "FHA will soon be in a similar untenable position as the government has become the holder of almost all new US mortgage product. If this is not sustained, despite it being a near impossibility to do such, US housing may not just fall further but collapse. CONCLUSION “The great enemy of the truth is very often not the lie – deliberate, contrived and dishonest – but the myth – persistent, persuasive and unrealistic.” John F. Kennedy 1962 commencement address at Yale University Americans must face the hard reality that the US is now in decline and rapidly relinquishing its hold as the world’s dominant industrial power. A serious failure in political leadership to recognize this and act upon it, along with misguided public policy legislation, has hastened the decline." Here's the schedule: NOGC+Florida (already staggering form Multiple savage blows) collapses. The USEmpire collapses(see Taliban cut off supplies from $1 million per soldier/Winter). World realizes only the Imperial City needs to be targeted.
And the fact that they have no control over the Highly leveraged product of 'others' is a better thing? Why am I thinking of Parents on Judge Judy now? 8D It was a gift. No! It was a loan! 8D
Details on demand. ;} And the mule that farted the most out of the bunch was considered the one most likely to haul the biggests loads.
Allowing someone to buy a house with $.67 or even $1,000 is allowing leverage. Sorry, but your "Same shit, different day" routine isn't passing muster here on LF.
Clinton and Cuomo are the true bandits who lit the fuse to this economic crisis we're now in. All in the name of getting more minorities in houses: http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=12554
Given that FNMA is under the USG ovesight, I find it laughable for you to attempt to say that Obama has nothing to do with this. YOu're pathetic.
Clinton and Cuomo are the true bandits who lit the fuse to this economic crisis we're now in. All in the name of getting more minorities in houses: http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=12554
You have nothing, dipshit, and if it wasn't for Paddy posting his racist crap, then, based upon crap posted, you'd be the biggest moron here. Your own article states that they did it without the knowledge of the overseer and that when the overseer found out it told FN to stop.
See everyone, you can't get an honest discussion out of War. FNMA allowing homes to be bought for sixty-seven cents? "No leverage there", the voices in War's head tell him. Dude, you're credibility has been shot to shit so many times on LF it's laughable.
Clinton and Cuomo are the true bandits who lit the fuse to this economic crisis we're now in. All in the name of getting more minorities in houses: http://libertysflame.com/cgi-bin/readart.cgi?ArtNum=12554
Your own article states that they did it without the knowledge of the overseer and that when the overseer found out it told FN to stop.
#2. To: All (#0)
#3. To: Nebuchadnezzar (#0)
(Edited)
More Democratic Shinanigans Setting the Nation up for another Real Estate Scandal/Bubble
#4. To: Nebuchadnezzar (#2)
"Hi, I'm Donna Shalalah I'm a dumb-bitch who fucked over Arizona and now I got promoted to be head of the nation's security and I fall asleep when Obama speaks..."
#5. To: war (#3)
The Real Estate bubble was caused by nonFN/FM eligible lending.
#6. To: mcgowanjm (#5)
#7. To: mcgowanjm (#5)
From 2004 to 2007, some 31.6 percent of the population lived in poverty for at least one period of two months or more.
#8. To: war (#6)
FN/FM don't use leverage.
#9. To: mcgowanjm (#8)
Please, war. Don't.
#10. To: war, All (#8)
#11. To: A K A Stone (#7)
#12. To: A K A Stone, All (#11)
#13. To: All (#12)
#14. To: war (#9)
They do suffer from the over leverage of others...
#15. To: mcgowanjm (#12)
And Obesity is a form of starvation.
#16. To: war (#6)
The "crisis": was caused by overleverage. FN/FM don't use leverage.
#17. To: war (#9)
They do suffer from the over leverage of others...
#18. To: Nebuchadnezzar (#17)
(Edited)
#19. To: war (#18)
You have nothing, dipshit, and if it wasn't for Paddy posting his racist crap, then, based upon crap posted, you'd be the biggest moron here.
#20. To: Nebuchadnezzar (#19)
(Edited)
Top • Page Up • Full Thread • Page Down • Bottom/Latest
[Home] [Headlines] [Latest Articles] [Latest Comments] [Post] [Mail] [Sign-in] [Setup] [Help] [Register]