As an active member of a number of blogs and a person who reads many different posts, I have read over the past few months the rising frustration of members of Activerain over the condition of the housing market. Many posts are ventings that blame the lenders and lax underwriting for the problem.
But in the past week or so, I have read many Realtor posts that fully support the housing bill. The NAR endorsed the bill and all of its components. And there has been outrage concerning the increase in FHA downpayments, the ending of Down Payment Assistance programs and other lending tools to help the first time buyer.
I'm confused? Didn't the problem come from lax lending? Is it sensible to loan 100k or more to someone that needs not only down payment assistance, but seller paid closing costs as well? How about all the loans that Fannie and Freddie did a couple of years ago that allowed buyers to get 103% and up to 107% loans? What about FHA and it's no score policy? What about the Community Reinvestment Act, which forces lenders to make loans in communities that are quote "underserved" by the banking community, kind of a reverse redlining?
What is going to fix the problem is for buyers to save a few thousand dollars before they look to buy. Nothing more, nothing less
I
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