Posted on 04/20/2023 6:30:17 PM PDT by Enlightened1
A Biden administration rule is set to take effect that will force good-credit home buyers to pay more for their mortgages to subsidize loans to higher-risk borrowers.
Experts believe that borrowers with a credit score of about 680 would pay around $40 more per month on a $400,000 mortgage under rules from the Federal Housing Finance Agency that go into effect May 1, costs that will help subsidize people with lower credit ratings also looking for a mortgage, according to a Washington Times report Tuesday.
"The changes do not make sense. Penalizing borrowers with larger down payments and credit scores will not go over well," Ian Wright, a senior loan officer at Bay Equity Home Loans, told the Times. "It overcomplicates things for consumers during a process that can already feel overwhelming with the amount of paperwork, jargon, etc. Confusing the borrower is never a good thing."
The Federal Housing Finance Agency, which oversees federally backed home mortgage companies Fannie Mae and Freddie Mac, has long sought to give consumers more affordable housing options. But those who work in the industry believe the new rules will only serve to frustrate and confuse people.
"This confusing approach won’t work and more importantly couldn’t come at a worse time for an industry struggling to get back on its feet after these past 12 months," David Stevens, a former commissioner of the Federal Housing Administration during the Obama administration, wrote in a social media post responding to the new rules. "To do this at the onset of the spring market is almost offensive to the market, consumers, and lenders."
(Excerpt) Read more at news.yahoo.com ...
Punish the innocent, reward the guilty.
It’s the Communist way.
Every time.
That’s mighty white of him.
Communism should work....this time....right Commissar Brandon?
Extra money to cover high risk mortgages? Riiiight. Or is this a slight of hand to recapture SVB funds?
Some may shrug if they were told $40/mo is to help the poor. But try telling them this is for SVB depositors and you’ll get what?
Scam, as well.
Remember the Rats’ CRA?
Joseph Stolen is an idiot
Subsidize people who don’t manage their credit and punish people who do.
This makes zero sense. This is what happens with rule by fiat.
I pay cash. Leaves me in a much better position to negotiate price. I did mortgages twice. After that I vowed to never do that again. No car loans either.
How the hell does he have the power to do this?
Anyone talk to congress about this?
Looks, smells and sounds like reparations. Expect more of the same.
“Subsidize people who don’t manage their credit and punish people who do.”
That describes EVERY government program under the sun. They ALL take from some people to give to other people. They are getting more and more audacious all the time, bankrupting the country.
This proposal sounds a lot like California charging well-to-do people more for their electricity than the less well off.
Communism is all around us.
Agreed. It’s yet another version of the Community Reinvestment Act and yet again it’ll exacerbate mortgage foreclosures and yet again it’ll tank the economy and yet again the Dims will blame “predatory lenders”.
Sounds like more derivatives for high risk borrowers.
How the hell does he have the power to do this?
Even more disgusting, is using a score of 680 as a benchmark. A credit score of 680 isn’t bragworthy in the least. This would soak anyone that a bank would loan to under normal circumstances, not just “the rich”.
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