What do you think? (Please go to the original post to express your opinion. Thanks!)
Should the government get out of the market? Who would then back the 95-100+% loans? In my opinion anything of 97% loan to value is just stupid. The purchaser must have some skin in the game or it is too easy to walk away.
Before Fannie Mae wasn't the best loan about 90% of value or was it only 80%. That is actually befor emy time!
THE SECONDARY MARKET PROVIDED BY FANNIE/FREDDIE.
Be careful what you ask for!!!
The secondary market provided by Fannie/Freddie have been crucial to the real estate industry and the economy of the United States.
The failures of Fannie/Freddie was not due to a systemic failure of their MISSION, to provide liquidity for mortgage originators.
This post inspired by Conrad Allen in 58.7 BILLION DOLLAR PROFIT BY FANNIE MAE
THE FAILURES OF FANNIE/FREDDIE (IMO) WAS CAUSED DIRECTLY BY:
POLITICAL CRONYISM (Franklin Raines),
Perfidy of the Wall Street Gangs(Securitization of Mortgage Backed Securities),
Perfidy of the Credit Rating Agencies (Credit rating agencies failures in the sub-prime market), and
The total failure of Congress to DO THEIR JOB.
How many who criticize Fannie/Freddie, have an understanding of the secondary market and how Fannie/Freddie make money available for lenders to lend to consumers.
Fannie/Freddie were just fine doing their job before Congress/the Wall Street gangs, etc. decided to make personal fortunes and further their political agenda by using Fannie/Freddie.
It would be smart before any more tinkering or elimination of Fannie/Freddie to consider the consequences.
Government is very good at acting and then observing the consequences.
Government is very bad at considering consequences before acting.
Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988, serving home buyers in Loudoun County VA.
SEE Articles on The Mortgage Mess.
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