I hadn’t realized it was that big a program.
Of course, we should have neither any of the federally-backed mortgage programs—and we should phase out the mortgage deduction, in favor of lower overall rates, on income taxes as well.
We agree. I’m a realtor and I just don’t work with buyers who I know are going to go FHA. Sometimes you have to, like if you have a listing and a buyer comes along who is going to go FHA. You have an obligation to your seller to get it sold. But if I run across some buyers and I know they have no money and are going to need FHA or other special financing.... I just don’t mess with them. (the advantage to being semi-retired)
Say you own a home and have it paid off. Instead of selling it you decide to provide the financing for a buyer so they will pay you for the next 15 to 30 years instead of a mortgage company. You're going to collect their escrow etc and just take the position of a mortgage company. Would you loan say $150k to some couple who is a 23 year old male, and a 22 year old female, who have two kids but they are not both his, they neither have been married, but have been living together for 9 months now. They work low level jobs and she's thinking about going back to college. Would you loan them 150k? The government will all day. It's government policy to help as many people as possible participate in the American dream of home ownership.