Gov’t Gone Wild! USDA’s Zero Down Mortgage on Martha’s Vineyard

Confounded Interest ^ | 06/09/2013 | Anthony B. Sanders

[whitedog57]

I attended a conference in New York City on Thursday regarding the future of housing finance. While all the proposals were interesting, I asked if this will mutate into another Obamacare debacle at 13,000 pages or the 1,000 page plus immigration bill. And I warned that government policies will assert themselves to control and manipulate whatever is decided, regardless of how ironclad one thinks it will be.

As an example, I mention the recent story where millionaires wanting to buy a home on Martha’s Vineyard are eligible for a zero percentage down payment mortgage from the USDA!

The US Department of Agriculture has designated the entire island is as a rural area eligible for a USDA loan.

When I think of a rural area, I think of farms, mountains, etc.

Martha’s Vineyard is a rural area? Vacation area for Wall Street, celebrities and politicians (like the Obama’s) perhaps. Indeed, Spike Lee, David Letterman, Carly Simon, James Taylor and Mike Nichols and Diane Sawyer are among the high-profile property owners on the island. Another regular is Larry David. The Martha’s Vineyard Commission estimates that the peak summer day population of 75,000 includes 15,000 year-round residents (20%). Of course, one of the costs of living on Martha’s Vineyard is the possibility of having to hear James Taylor warbling endlessly.

Has the USDA gone wild? the recent “Farm” Bill of $955 Billion was revealed to be 80% for funding of food stamps.

This is why I am not confident of a “solution” to the government-backed housing finance system. There is always someone saying “But shouldn’t lower and middle income families have the opportunity to buy a home on EXPENSIVE vacation spots like Martha’s Vineyard?” You mean, renting isn’t good enough?

That is the flaw in government mortgage programs. Government could insure prime mortgages (10% or more down, credit scores of 660 and above, etc) and have everyone else rent. But the “affordable” housing advocates want taxpayers to subsidize risky lending.

Martha’s Vineyard and affordable housing? Oh please.

[whitedog57]

Cronyism. This is why no sensible GSE reform will take place.

[Menehune56]

Just trying to re-inflate the bubble.

[Carriage Hill]

In 22yrs of owning a Family Farm Business, I never got a thin dime from any so-called Farm Bill. They all were catch-alls for welfare and a thousand other freebie-subsidy/aid programs for other programs and multi-millionaires, like Springsteen, who "farm" bees on his massive estate, via someone else, and pay no taxes. We Farmers got diddly-squat. (I didn't apply for anything, and wouldn't have taken a dime, anyway.) It's just a trillion-dollar hoax, with our hard-earned tax dollars.

[mdittmar]

Someone I know just got a USDA loan,single mom,2 kids,living in a Section 8 apartment.
She works hard,she now is the proud owner of a 2 bedroom home in a nice neighborhood,interest rate of 3.5% on a 30 year mortgage,she did good,wanted to get away from the government cheese.