Wisconsin Real Estate | 30-Year Fixed Rate Mortgages ? Will They Die With Fannie And Freddie?
The housing bubble crisis can be seen all across the country. Foreclosures in Michigan, short sales in Wisconsin and bank-owned homes in Indiana. It seems there isn?t a state that?s free from the foreclosure mess. But is the answer to the problem to simply shut down mortgage giants Fannie Mae and Freddie Mac? That seems to be the plan from the federal government. It?s a goal House Republicans share with President Obama.
How Does This Affect Me?
Shutting down Fannie and Freddie would likely lead to the end of something that?s part of the American way of life: the 30-year fixed rate mortgage. Experts in the housing market from both political parties agree that interest rates would likely rise for most borrowers. Also, standard practices like locking an interest rate could become something home buyers pay for out of pocket.
Why is the Government Doing This?
Are the feds trying to ruin the American dream of home ownership? It?s unlikely that the government simply wants to cause trouble for first time home buyers, other borrowers and the real estate industry. But its actions will likely do just that.
Mark Jones, president of AmeriFirst Home Mortgage recently gave me some insight into the reasons and the fallout to this latest mortgage industry move.
Most of the things the government is trying to do with the housing finance issue is based on the premise that the entire industry was broken and that?s what caused the meltdown. Now there is a huge push by politicians to over compensate with regulation and change to show their constituents just how tough they are.
The facts are that the industry worked properly and without any need for intervention from the federal government until traditional credit standards that were used for decades were abandoned. Easy credit standards fueled by Wall Street?s insatiable appetite for high yield, and Fannie Mae/Freddie Mac?s tacit endorsement of these new relaxed standards created a bubble that is now an epic binge from which we are still suffering from a long hangover.
However, the products that created the nightmare are now gone and our industry is underwriting loans the way we traditionally have. The book of business closed over the past 2 ½ years is performing amazingly well and all of the players who made their livings in the Sub-prime and Alt A world are gone.
Instead of over regulating our industry and reducing the government?s commitment to housing through closing Fannie Mae/Freddie Mac and reducing HUD?s role, I think the government should instead focus on products with lax credit standards and consumer-unfriendly terms. In other words, let?s fix what caused the problem and not destroy the whole industry and homeownership along with it.
If the government needs a model for what works, they need to look no further than the department of Housing and Urban Development (HUD) and specifically to Ginnie Mae (GNMA- Governmental National Mortgage Association).
In simple terms, Ginnie Mae does for FHA, VA, and USDA loans what Fannie Mae and Freddie Mac do for conventional loans by providing a secondary market for ?government loans?. Ginnie Mae over the past two fiscal years has made a PROFIT of over ½ a Billion each year.
Imagine, a government agency that actually sends surplus funds (which is what they actually call it in their annual report to congress?I guess the P word is bad news in government) to the Treasury. The reason that this has worked for Ginne Mae while Fannie/Freddie are hemorrhaging cash is because the credit standards on the loans that Ginnie Mae provides liquidity for NEVER CHANGED.
The industry was never broken; it just went crazy for several years.
Your Takeaway
If the government has its way, the standard of borrowing Americans are accustomed to could be taking its final breaths in the years to come. But instead of simply killing Fannie/Freddie, the feds ought to look at other symptoms of the housing bubble catastrophe.
Dan Moyle is the Multimedia Marketing & Communications Specialist at AmeriFirst Home Mortgage. The AmeriFirst Blog is part of his daily routine.
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ByDan Moyle
|
The housing bubble crisis can be seen all across the country. Foreclosures in Michigan, short sales in Wisconsin and bank-owned homes in Indiana. It seems there isn?t a state that?s free from the foreclosure mess. But is the answer to the problem to simply shut down mortgage giants Fannie Mae and Freddie Mac? That seems to be the plan from the federal government. It?s a goal House Republicans share with President Obama.
How Does This Affect Me?
Shutting down Fannie and Freddie would likely lead to the end of something that?s part of the American way of life: the 30-year fixed rate mortgage. Experts in the housing market from both political parties agree that interest rates would likely rise for most borrowers. Also, standard practices like locking an interest rate could become something home buyers pay for out of pocket.
Why is the Government Doing This?
Are the feds trying to ruin the American dream of home ownership? It?s unlikely that the government simply wants to cause trouble for first time home buyers, other borrowers and the real estate industry. But its actions will likely do just that.
Mark Jones, president of AmeriFirst Home Mortgage recently gave me some insight into the reasons and the fallout to this latest mortgage industry move.
Most of the things the government is trying to do with the housing finance issue is based on the premise that the entire industry was broken and that?s what caused the meltdown. Now there is a huge push by politicians to over compensate with regulation and change to show their constituents just how tough they are.
The facts are that the industry worked properly and without any need for intervention from the federal government until traditional credit standards that were used for decades were abandoned. Easy credit standards fueled by Wall Street?s insatiable appetite for high yield, and Fannie Mae/Freddie Mac?s tacit endorsement of these new relaxed standards created a bubble that is now an epic binge from which we are still suffering from a long hangover.
However, the products that created the nightmare are now gone and our industry is underwriting loans the way we traditionally have. The book of business closed over the past 2 ½ years is performing amazingly well and all of the players who made their livings in the Sub-prime and Alt A world are gone.
Instead of over regulating our industry and reducing the government?s commitment to housing through closing Fannie Mae/Freddie Mac and reducing HUD?s role, I think the government should instead focus on products with lax credit standards and consumer-unfriendly terms. In other words, let?s fix what caused the problem and not destroy the whole industry and homeownership along with it.
If the government needs a model for what works, they need to look no further than the department of Housing and Urban Development (HUD) and specifically to Ginnie Mae (GNMA- Governmental National Mortgage Association).
In simple terms, Ginnie Mae does for FHA, VA, and USDA loans what Fannie Mae and Freddie Mac do for conventional loans by providing a secondary market for ?government loans?. Ginnie Mae over the past two fiscal years has made a PROFIT of over ½ a Billion each year.
Imagine, a government agency that actually sends surplus funds (which is what they actually call it in their annual report to congress?I guess the P word is bad news in government) to the Treasury. The reason that this has worked for Ginne Mae while Fannie/Freddie are hemorrhaging cash is because the credit standards on the loans that Ginnie Mae provides liquidity for NEVER CHANGED.
The industry was never broken; it just went crazy for several years.
Your Takeaway
If the government has its way, the standard of borrowing Americans are accustomed to could be taking its final breaths in the years to come. But instead of simply killing Fannie/Freddie, the feds ought to look at other symptoms of the housing bubble catastrophe.
Dan Moyle is the Multimedia Marketing & Communications Specialist at AmeriFirst Home Mortgage. The AmeriFirst Blog is part of his daily routine.
Article Source:http://EzineArticles.com/?expert=Dan_Moyle
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Moyle, Dan?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.8 Mar. 2011EzineArticles.com.13 Aug. 2011 http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654>.
Moyle, D. (2011, March 8). 30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?. Retrieved August 13, 2011, from http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654
Moyle, Dan ?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.? 30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?EzineArticles.com. http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654
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Wisconsin Real Estate | 30-Year Fixed Rate Mortgages ? Will They Die With Fannie And Freddie?
The housing bubble crisis can be seen all across the country. Foreclosures in Michigan, short sales in Wisconsin and bank-owned homes in Indiana. It seems there isn?t a state that?s free from the foreclosure mess. But is the answer to the problem to simply shut down mortgage giants Fannie Mae and Freddie Mac? That seems to be the plan from the federal government. It?s a goal House Republicans share with President Obama.
How Does This Affect Me?
Shutting down Fannie and Freddie would likely lead to the end of something that?s part of the American way of life: the 30-year fixed rate mortgage. Experts in the housing market from both political parties agree that interest rates would likely rise for most borrowers. Also, standard practices like locking an interest rate could become something home buyers pay for out of pocket.
Why is the Government Doing This?
Are the feds trying to ruin the American dream of home ownership? It?s unlikely that the government simply wants to cause trouble for first time home buyers, other borrowers and the real estate industry. But its actions will likely do just that.
Mark Jones, president of AmeriFirst Home Mortgage recently gave me some insight into the reasons and the fallout to this latest mortgage industry move.
Most of the things the government is trying to do with the housing finance issue is based on the premise that the entire industry was broken and that?s what caused the meltdown. Now there is a huge push by politicians to over compensate with regulation and change to show their constituents just how tough they are.
The facts are that the industry worked properly and without any need for intervention from the federal government until traditional credit standards that were used for decades were abandoned. Easy credit standards fueled by Wall Street?s insatiable appetite for high yield, and Fannie Mae/Freddie Mac?s tacit endorsement of these new relaxed standards created a bubble that is now an epic binge from which we are still suffering from a long hangover.
However, the products that created the nightmare are now gone and our industry is underwriting loans the way we traditionally have. The book of business closed over the past 2 ½ years is performing amazingly well and all of the players who made their livings in the Sub-prime and Alt A world are gone.
Instead of over regulating our industry and reducing the government?s commitment to housing through closing Fannie Mae/Freddie Mac and reducing HUD?s role, I think the government should instead focus on products with lax credit standards and consumer-unfriendly terms. In other words, let?s fix what caused the problem and not destroy the whole industry and homeownership along with it.
If the government needs a model for what works, they need to look no further than the department of Housing and Urban Development (HUD) and specifically to Ginnie Mae (GNMA- Governmental National Mortgage Association).
In simple terms, Ginnie Mae does for FHA, VA, and USDA loans what Fannie Mae and Freddie Mac do for conventional loans by providing a secondary market for ?government loans?. Ginnie Mae over the past two fiscal years has made a PROFIT of over ½ a Billion each year.
Imagine, a government agency that actually sends surplus funds (which is what they actually call it in their annual report to congress?I guess the P word is bad news in government) to the Treasury. The reason that this has worked for Ginne Mae while Fannie/Freddie are hemorrhaging cash is because the credit standards on the loans that Ginnie Mae provides liquidity for NEVER CHANGED.
The industry was never broken; it just went crazy for several years.
Your Takeaway
If the government has its way, the standard of borrowing Americans are accustomed to could be taking its final breaths in the years to come. But instead of simply killing Fannie/Freddie, the feds ought to look at other symptoms of the housing bubble catastrophe.
Dan Moyle is the Multimedia Marketing & Communications Specialist at AmeriFirst Home Mortgage. The AmeriFirst Blog is part of his daily routine.
Article Source:
Did you find this article helpful?00
About the Author:
0){parent.location.href = self.document.location;}]]>
Home
? Real Estate
? Mortgage Refinance
Ads By Google?);for(i=0;i
?);}]]>]]>Dan Moyle
Basic PLUSAuthor|16 Articles
Joined: January 25, 2011Was this article helpful?00 0) { var s0 = ?;s0 += ?Ads by Google
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ByDan Moyle
|
The housing bubble crisis can be seen all across the country. Foreclosures in Michigan, short sales in Wisconsin and bank-owned homes in Indiana. It seems there isn?t a state that?s free from the foreclosure mess. But is the answer to the problem to simply shut down mortgage giants Fannie Mae and Freddie Mac? That seems to be the plan from the federal government. It?s a goal House Republicans share with President Obama.
How Does This Affect Me?
Shutting down Fannie and Freddie would likely lead to the end of something that?s part of the American way of life: the 30-year fixed rate mortgage. Experts in the housing market from both political parties agree that interest rates would likely rise for most borrowers. Also, standard practices like locking an interest rate could become something home buyers pay for out of pocket.
Why is the Government Doing This?
Are the feds trying to ruin the American dream of home ownership? It?s unlikely that the government simply wants to cause trouble for first time home buyers, other borrowers and the real estate industry. But its actions will likely do just that.
Mark Jones, president of AmeriFirst Home Mortgage recently gave me some insight into the reasons and the fallout to this latest mortgage industry move.
Most of the things the government is trying to do with the housing finance issue is based on the premise that the entire industry was broken and that?s what caused the meltdown. Now there is a huge push by politicians to over compensate with regulation and change to show their constituents just how tough they are.
The facts are that the industry worked properly and without any need for intervention from the federal government until traditional credit standards that were used for decades were abandoned. Easy credit standards fueled by Wall Street?s insatiable appetite for high yield, and Fannie Mae/Freddie Mac?s tacit endorsement of these new relaxed standards created a bubble that is now an epic binge from which we are still suffering from a long hangover.
However, the products that created the nightmare are now gone and our industry is underwriting loans the way we traditionally have. The book of business closed over the past 2 ½ years is performing amazingly well and all of the players who made their livings in the Sub-prime and Alt A world are gone.
Instead of over regulating our industry and reducing the government?s commitment to housing through closing Fannie Mae/Freddie Mac and reducing HUD?s role, I think the government should instead focus on products with lax credit standards and consumer-unfriendly terms. In other words, let?s fix what caused the problem and not destroy the whole industry and homeownership along with it.
If the government needs a model for what works, they need to look no further than the department of Housing and Urban Development (HUD) and specifically to Ginnie Mae (GNMA- Governmental National Mortgage Association).
In simple terms, Ginnie Mae does for FHA, VA, and USDA loans what Fannie Mae and Freddie Mac do for conventional loans by providing a secondary market for ?government loans?. Ginnie Mae over the past two fiscal years has made a PROFIT of over ½ a Billion each year.
Imagine, a government agency that actually sends surplus funds (which is what they actually call it in their annual report to congress?I guess the P word is bad news in government) to the Treasury. The reason that this has worked for Ginne Mae while Fannie/Freddie are hemorrhaging cash is because the credit standards on the loans that Ginnie Mae provides liquidity for NEVER CHANGED.
The industry was never broken; it just went crazy for several years.
Your Takeaway
If the government has its way, the standard of borrowing Americans are accustomed to could be taking its final breaths in the years to come. But instead of simply killing Fannie/Freddie, the feds ought to look at other symptoms of the housing bubble catastrophe.
Dan Moyle is the Multimedia Marketing & Communications Specialist at AmeriFirst Home Mortgage. The AmeriFirst Blog is part of his daily routine.
Article Source:http://EzineArticles.com/?expert=Dan_Moyle
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?); return;}google_ad_client = ?pub-3754405753000444?;//EA-Real Estate Mortgage Refinance 160google_ad_channel = ?2012143359?;google_ad_output = ?js?;google_max_num_ads = ?7?;google_ad_type = ?text?;google_feedback = ?on?;google_hints = ?government industry housing loans mortgage fannie standards credit?;google_ad_region = ?test?;// ?>]]>Get Involved0 commentsSuggest a topicArticle ToolsPrint this articleE-mail to a friendEzinePublisherReport this articleCite this articleStay InformedGet notified by email when new articles are added to this category or written by this author.
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?; document.write(?+s+?
Moyle, Dan?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.8 Mar. 2011EzineArticles.com.13 Aug. 2011 http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654>.
Moyle, D. (2011, March 8). 30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?. Retrieved August 13, 2011, from http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654
Moyle, Dan ?30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?.? 30-Year Fixed Rate Mortgages ? Will They Die With Fannie and Freddie?EzineArticles.com. http://ezinearticles.com/?30-?Year-?Fixed-?Rate-?Mortgages-?-?-?Will-?They-?Die-?With-?Fannie-?and-?Freddie?&id=6050654EzineArticles.com
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