September 30, 1999

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Post by namvet on Thu Feb 26, 2009 8:56 pm

Fannie Mae Eases Credit To Aid Mortgage Lending

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 Klinton 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 addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.

''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.

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.''

Under Fannie Mae's pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 -- a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.

Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.

Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.

Home ownership has, in fact, exploded among minorities during the economic boom of the 1990's. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University's Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.

http://query.nytimes.com/gst/fullpage.html?res=9C0DE7DB153EF933A0575AC0A96F958260

well well. lookie who else was trying to burn the house down. proof. there's not a god damned honest lib in this country. including the shit head in there now.
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Post by NonConformist on Thu Feb 26, 2009 8:57 pm

And yet Obama Drulz will stay say it was Bush's fault...what a fucking tool!
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Post by namvet on Thu Feb 26, 2009 9:00 pm

NonConformist wrote:And yet Obama Drulz will stay say it was Bush's fault...what a fucking tool!

obviously his threads are stripped. he got screwed once to often lol!
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Post by Remo on Thu Feb 26, 2009 9:18 pm

This was part of the problem, but not the whole story. A lot of people fell on hard times, laid off, medical bills, illness, and were foreclosed on because that asshole Bush and his GOP crew gave the banks a collective blow job with their debacle of "bankruptcy reform" which effectively prevented decent people from reorganzing under the very bankruptcy laws the GOP is now praising for their corporate buddies. Bush was every bit as much an asshole as Klinton. Just in different ways. A lot of those people, under the old bankruptcy laws, would have kept their houses, recovered and got back on their feet, all while staying in their house.

Now I hear the hypocritical Republicans saying they want GM and Chrysler and Citibank to declare bankruptcy instead of being bailed out, when the fucking GOP fucked the citizens with their goddamned 'bankruptcy reform' FUCK THE GOP. They are no fucking better than the Dems.
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Post by namvet on Thu Feb 26, 2009 9:30 pm

Remo wrote:This was part of the problem, but not the whole story. A lot of people fell on hard times, laid off, medical bills, illness, and were foreclosed on because that asshole Bush and his GOP crew gave the banks a collective blow job with their debacle of "bankruptcy reform" which effectively prevented decent people from reorganzing under the very bankruptcy laws the GOP is now praising for their corporate buddies. Bush was every bit as much an asshole as Klinton. Just in different ways. A lot of those people, under the old bankruptcy laws, would have kept their houses, recovered and got back on their feet, all while staying in their house.

Now I hear the hypocritical Republicans saying they want GM and Chrysler and Citibank to declare bankruptcy instead of being bailed out, when the fucking GOP fucked the citizens with their goddamned 'bankruptcy reform' FUCK THE GOP. They are no fucking better than the Dems.

hate to blow away your post. but ACORN went to work on Caters watch. Bush never supported them. they knew better than to lay it him. so they went after these weak willied and weak minded liberals. who are responsible for this whole fuckin mess !!!! FUCK THE DEMOCRATS !!!!
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Post by GD2GO on Thu Feb 26, 2009 9:35 pm

The Repukicans caused as much of this mess as the Dems. They both won't to expand the size, power and debt of the federal government. The Dems just want to do it a little faster.
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Post by KSigMason on Thu Feb 26, 2009 11:15 pm

Yeah, I've read a lot about this. I've also heard that many Libs (Congressional folk) are somehow connected to many of the banks and lending companies.

Here's a fun fact to make some of you feel old...I was in the 9th grade in September 1999. Wink
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Post by namvet on Fri Feb 27, 2009 8:55 am

they all have their hand out. Klinton was no different. he was into cigars and $$$. except in this case Bin laden was making his move.
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Post by submarinepainter on Fri Feb 27, 2009 5:36 pm

iluvfreebeer wrote:The Repukicans caused as much of this mess as the Dems. They both won't to expand the size, power and debt of the federal government. The Dems just want to do it a little faster.

We need a powerful candidate for a 3rd party run , the Candidate doesn't even have to win just a powerful showing would get middle of the road Dem's and true conservatives in line . for some reason these assholes are scare of liberals??
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Post by GD2GO on Fri Feb 27, 2009 5:38 pm

Does anyone think Newt Gingrich could win in 2010 for the GOP? I like Palin, but she's not electable at the top of the ballot. She'd be good as the secretary of the interior, or maybe in the Senate.
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Post by namvet on Fri Feb 27, 2009 5:51 pm

iluvfreebeer wrote:Does anyone think Newt Gingrich could win in 2010 for the GOP? I like Palin, but she's not electable at the top of the ballot. She'd be good as the secretary of the interior, or maybe in the Senate.

I heard she will make a run at the senate in 10
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