This is just too unbelievable to me.
Fannie Mae ... estimated up to 50 percent of the borrowers, whose sub-primes it bought that year, had credit profiles that could have qualified them for prime rates.
Freddie Mac...estimated that borrowers of 15 to 35 percent of all sub-prime loans it bought in 2005 could have qualified for prime-rate loans
This was in a story I just read on cnnfn.com.
They then quote a 1999 survey which found that 31% of all buyers never spoke to anyone except their real estate agent when they bought their home. They get a dig in at real estate agents insinuating I guess that agents are steering their clients to lenders who are ripping them off.
"If you've got plenty of money and don't mind not getting the best rate, listen to your realtor."
I really resent that statement. Why would a real estate agent want their client to end up with a more expensive loan than necessary?
I don't doubt that lenders might be tempted by the higher fees with a sub-prime loan, but I just don't see a real estate agent consciously being part of that game. What's in it for them?
All you lenders out there. Come clean here. Do you know of anyone who was put in a sub-prime loan when they in fact could have qualified for a prime mortgage rate? I'm hoping that this is just some outrageous story that must have some other explanation. Or are there a lot of sleaze ball lenders out there? I guess I hang with the good crowd.
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