Isnt hindsight a beauty?

[Freedom4all]

More government is (not so) good history.

Fannie Mae Eases Credit To Aid Mortgage Lending
NYT Published: Thursday, September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times.

But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

 

[freedom]

More government is (not so) good history.

Fannie Mae Eases Credit To Aid Mortgage Lending
NYT Published: Thursday, September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times.

But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

Right now the current mortage crisis is not due to loans from the late ninteys and early 2000's ... back then homes were affordable ... the problems we are being hit with now are due to homes from at least 2004 onwards , ARMS and NIJAS etc .... also back in the late 90's and early 2000's homes were not over valued like they became up till 2007

 

[Freedom4all]

Right now the current mortage crisis is not due to loans from the late ninteys and early 2000's ... back then homes were affordable ... the problems we are being hit with now are due to homes from at least 2004 onwards , ARMS and NIJAS etc .... also back in the late 90's and early 2000's homes were not over valued like they became up till 2007

Nope, it started back then and as record low rates fueled the repetitive refinancing and cash outs, overextending the borrowers. Clinton lit the fuse only to blow up later.

And who do you think drew the guidelines for arms, low doc an no doc loan products? Fannie! They were the single largest purchaser of these products on the secondary market.

As long as the loans were underwritten and conformed to Fannies published guidelines then the loan could be sold to Fannie. And trust me, they bought up a majority of these.

The second largest was Lehman aka Aurora Loan Services, they had at one time 100% financing, investment property, no documentation, 620 credit score, 4plex, up to 750k. Primary res up to w
1.25 mill.

 

[freedom]

Nope, it started back then and as record low rates fueled the repetitive refinancing and cash outs, overextending the borrowers. Clinton lit the fuse only to blow up later.

And who do you think drew the guidelines for arms, low doc an no doc loan products? Fannie! They were the single largest purchaser of these products on the secondary market.

As long as the loans were underwritten and conformed to Fannies published guidelines then the loan could be sold to Fannie. And trust me, they bought up a majority of these.

The second largest was Lehman aka Aurora Loan Services, they had at one time 100% financing, investment property, no documentation, 620 credit score, 4plex, up to 750k. Primary res up to w
1.25 mill.

no , my point was that the loans that were made during the early part of the 2000's were basiclly sound . homes were still valued properly and underwriting standards hadn't gone down the tubes at that point ...

The homes that began to "blow up " occured much later in the time line ... if you look at credit avalbilty and home prices you can see where we hit the celining ...