FANNIE/FREDDIE To Become "History"?? 3.6.13

By
Real Estate Agent with Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate 303829;0225082372

FANNIE/FREDDIE To Become "History"??


The governments plan to "ease" itself out of the mortgage business are a puzzlement.  Or, they are above my pay grade to comprehend.

One part of the proposed plan as of now is:

          "It would continue to increase the fees charged for government
           guarantees to help encourage private companies to take up the slack."

Seems that, no matter what the subject matter, increasing costs to the consumer is at the bottom of the plan.  It's as though, "If you can't solve a problem, just raise the cost to the consumer".

That's not all.  The plan to east Fannie/Freddie OUT include:

  • It will create a new company — completely separate from Fannie and Freddie — that would combine many of the back-end operations of the the two companies.
  • It would continue to increase the fees charged for government guarantees to help encourage private companies to take up the slack.
  • It will direct Fannie and Freddie to each sell at least $30 billion of the mortgage-backed securities they hold to private investors, taking taxpayers off the hook for those.
  • It will reduce the companies’ presence in the multifamily housing business by 10 percent.

SEE:  The Virginia Association of Real Estate News.

MISSING FROM THE PLAN?? 

          Analysis of the role of the RATING AGENCIES, Moody's, Standard & Poor's, Fitch, etc. has not been clarified.  Will Fannie and Freddie be mixing BBB and AAA instruments as in the past?  Will the rating agencies be giving them a high rating as in the past.

IS THERE ANY ASSURANCE THAT PRIVATE INVESTORS WILL PICK UP THE SLACK WHEN AND IF FANNIE/FREDDIE depart???

Courtesy, Lenn Harley, Broker, Homefinders.com, 800-711-7988, serving home buyers in MD and Northern Virginia.

                     Family

 

 

"Honey, why can't our home loan get approved?  It's been weeks."
                                       

"I'm not sure Dear, the mortgage company said it has something to do with the SECONDARY MARKET.  Apparently, they are having trouble finding investors to buy our loan.

"But, Julie and Dan didn't have any trouble when they bought their home.'

"Apparently, things were different when Fannie Mae was around."                                      


 

 

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March 2013, A Post A Day With 4 Q&A.
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Rainmaker
848,657
Bob Miller
Keller Williams Cornerstone Realty - Ocala, FL
The Ocala Dream Team

Hi Lenn, if you have read any of our "Robbing Peter to Pay Paul" series you know our feeling on this.  lol

Mar 05, 2013 07:17 PM #1
Rainmaker
3,301,532
Sally K. & David L. Hanson
EXP Realty 414-525-0563 - Brookfield, WI
WI Realtors - Luxury - Divorce

  Point well taken..."assurance" of what any...or a group of private investors would/will do...not sure how clear the crystal financial ball is that would guarantee that.

Mar 05, 2013 07:26 PM #2
Rainmaker
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John F Muscarella
RIVER FARM PROPERTIES, LLC - Venice, FL
Broker/Owner, Venice, FL, Florida's Suncoast

But don't forget it's the government and they're here to help us.

Mar 05, 2013 07:26 PM #3
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Rob.  I'll take a look.  Thanks.

Sally & David.  There are absolutely none.  They're making FHA so expensive. . . .  Not good to kill off the secondary market.

John.  Where did that bridge go??

Mar 05, 2013 07:33 PM #4
Rainmaker
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Roger D. Mucci
Shaken...with a Twist 216.633.2092 - Euclid, OH
Lets shake things up at your home today!

Seems like there is some major concern about private investors for good reason.

Mar 05, 2013 07:43 PM #5
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Roger.  Many private investors have found other avenues for their money.  Housing is no longer the safe investment it once was.

Mar 05, 2013 07:47 PM #6
Rainmaker
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Jay Markanich
Jay Markanich Real Estate Inspections, LLC - Bristow, VA
Home Inspector - servicing all Northern Virginia

I do not think the gubment has any intention of removing its paws from the housing market.  It will NEVER give up that control.  There may be a new entity created, "better" than the old, but see the new boss?  Same as the old boss!  The Doors said that years ago.

Mar 05, 2013 08:14 PM #7
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Jay.  What if the intent is to destroy that housing industry?? 

Getting rid of the investing secondary market is one way.

Mar 05, 2013 08:22 PM #8
Rainmaker
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Jay Markanich
Jay Markanich Real Estate Inspections, LLC - Bristow, VA
Home Inspector - servicing all Northern Virginia

That's exactly the result of doing this.  And the intent.  Once destroyed who will sweep in to "fix" things?  Right, the new boss!

Same as the old boss...

Mar 05, 2013 09:20 PM #9
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George Souto
George Souto NMLS #65149 FHA, CHFA, VA Mortgages - Middletown, CT
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Lenn, there has been a lot of talk, but I have not seen anything that says that getting Fannie & Freddie out of government control is a done deal.  Fannie, Freddie and FHA just keep on increasing their fees, and the bottom line is the consumer pays for it, and the House Market suffers for it.

Mar 05, 2013 09:30 PM #10
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Jay.  HA!  You've been keeping track.

George.  Indeed.  Time was when folks could just save up for the down payment.  Now they have to save up to feed the government black hole.

Mar 05, 2013 09:49 PM #11
Rainmaker
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Jon Kolsky
Kolsky Realty & Management - Long Beach, CA
Licensed California Real Estate Broker

Lenn~ I woke up this morning and this blog was the first blog I read. I instantly marked this blog so that I would make a comment on it, so this was coming even if your comment was for tomorrow 8~)

"OK" IMO- forget about "free trade" that is the wolf in sheep's clothing. The MAIN thing lighting a fire in the RE market is "low interest rates" (FRED & FAN & FED CHAIR) must protect low interest rates, JMO 8~) & stunning blog, btw 8~)

Mar 06, 2013 03:18 AM #12
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Lenn Harley
Lenn Harley, Homefinders.com, MD & VA Homes and Real Estate - Leesburg, VA
Real Estate Broker - Virginia & Maryland

Jon.  I'm fine with low interest rates.  As long as Fannie & Freddie don't bundle bad loans and securitize them.

Mar 06, 2013 03:24 AM #13
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