freddie mac: Big Changes From Freddie Mac
- 11/07/08 11:51 AM
Freddie Mac has announced that they are matching many of the changes that Fannie made earlier this year. Honestly most banks and all the PMI companies were already following Fannie's rules; so, these rules really only additionally apply to banks like U.S. Bank who is a Freddie Mac lender and for borrowers who put more than 20% down on a new home. Here is a summary of the changes-- •· If the buyer's current principal residence is not sold and closed, you MUST count both house payments against the borrowers as they buy and close on their new home. Second, they … (4 comments)
freddie mac: Mortgage Mess Part 15--Breaking Up is Hard to Do
- 10/31/08 07:29 AM
The third solution to keep this Mortgage Mess from ever happening again is by addressing the policy of "Too big to fail". In the last 15 years we have allowed and even encouraged companies to grow too big for the public's good. Fannie Mae and Freddie Mac are the poster children of this policy. Together they own or guarantee $5.3 TRILLION in mortgages or roughly 50% of the market place. These companies are way too big and were allowed to do so by our politicians (please see my previous posts on this issue). Personally, I think Fannie and Freddie need to … (1 comments)
freddie mac: Mortgage Mess Part 2--Greed and More Greed
- 10/13/08 11:05 AM
As I covered previously the Federal Reserve kept interest rates at historical lows for 46 consecutive months and this combined with the Bear Market in stocks from early 2000 through October 2002 caused both individual and institutional investors to seek higher returns elsewhere. They found them by buying Mortgage Backed Securities or MBS's. At first they just bought the cream of the crop with yields in the 5% range. Then GREED set in and 5% was not good enough anymore, they wanted 6%, then 7%, etc. But, to provide those higher rates of return the MBS's contained riskier loans. However, a majority … (0 comments)
Freddie Mac has announced that they are matching many of the changes that Fannie made earlier this year. Honestly most banks and all the PMI companies were already following Fannie's rules; so, these rules really only additionally apply to banks like U.S. Bank who is a Freddie Mac lender and for borrowers who put more than 20% down on a new home. Here is a summary of the changes--
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