Posted on 10/20/2014 3:18:01 PM PDT by John W
A federal housing regulator on Monday announced a plan that could ease tight credit and allow more people to qualify for mortgages in an attempt to put the nation’s housing market back on track.
The plan, announced at a convention of mortgage bankers, includes offering reassurances to lenders that fear they could suffer unpredictable losses on the loans they sell to the government.
Separately, plans are in motion to set up programs for borrowers to receive government-backed loans with much smaller down payments than are now required.
“We know that access to credit remains tight for many borrowers, and we are also working to address this issue in a responsible and thoughtful manner,” said Melvin L. Watt, director of the Federal Housing Finance Agency, which regulates the mortgage finance giants Fannie Mae and Freddie Mac.
(Excerpt) Read more at nytimes.com ...
Here we go again!
Let’s start that crap all over again; after all we know the banks won’t lose money on the deals.
The bankers are looking for more suckers...
Some things never change.
Been there,seen this before.I can feel someone trying to lift my wallet again.
Bring back the government-created housing bubble!
CRA All The Way!
Every bank that issues a mortgage should be required to hold that mortgage for a minimum of three years before selling it. Problem solved. Banks will only issue mortgages that they believe they won’t be saddled with non-payers.
The actual value of a house is $50,000, but it is sold for $555,000. Pretending that after a housing slump it will again be sold for $555,000 is an (opium) pipe dream, because it is not *worth* that amount.
Better yet, require the issuing institution to hold the note until 20% equity is achieved, whether that’s due to paying down the note, appreciation or improvements to the property.
A 3 Year Holding requirement is brilliant and simple and would actually fix 90% of the problems. Banks wouldn’t make loans they thought would default and they would make more loans to people with good cash flow who otherwise don’t qualify for any number or bureaucratic reasons. Extend it to 5 years and you’d pretty much wipe out the flimsy moprtage market.
I was just thinking, wouldn’t it be great if we could bring back liar loans and hand houses to people who can’t afford them. Maybe even bundle them and sell them to other financial institutions. Win/Win.
In other words:
The next wave of bad mortgages will be caught after the ‘new’ two 30 day delinquencies have passed.
In other words:
After about 60 days, a new wave of bad mortgages will start surface.
So easing regulations allows more people to participate in a market?
That doesn't sound Democratic Party, what gives?...
Here we go again was my first thought also. When is anyone in our government going to learn that if you keep doing the same thing over and over you will keep getting the same results.
Not so strangely, in this case YES! Let's just replay the last debacle and have it go to s**t when a Republican administration is in place!
Yes its the never ending cycle. I was in the mortgage industry for 27 years. It just recycles. You have to remember that mortgage lenders are in the business of lending money. If they can’t make loans they go out of business. When I was an underwriter the first thing that would happen when the market dried up is that they would come around and tell us to loosen up the underwriting. If rates get too high they just go back to the ARM’s and the interest only loans. Then the subprime and no doc loans.
Yup lets punish Those that actually plan for a house by spiking the price. Lets spike the price by giving those who have not planned and do not have the means to buy a house by guaranteeing that everyone else will pay for the house they get. Including those who now can’t afford to buy a house because they are paying for those who can’t afford a house.
Only hedge funds and other cash buyers could get in on the lows after the crash, now the hedgies want out (they have found out that being a landlord is not much fun) so the lending standards are lowered so there are buyers for their properties.
Oh yeah. That worked really well the first time.
BTW Are Fwank and Dodd in prison?
Bingo we have a winner, over 60% of all residential real estate sold in the last 5 years was Cash Sales.
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