HLS, your post isn’t primarily about investment properties, but still… I wanted to get this off my chest for a long time, and you provided the opportunity:

I’ve never understood why Fannie and Freddie were allowed to deal with non-owner occupied mortgages in the first place. They’re taxpayer sponsored entities (more like taxpayer owned, recently) supposed to “help foster homeownership”, right? How exactly is giving a mortgage to a landlord helping homeownership? Could someone explain that to me, please?

Now, don’t get me wrong, a landlord should be able to get a mortgage, of course. There is a private market for mortgages, isn’t there? I just can’t see what interest, as a taxpayer, I would have in “sponsoring” such an enterprise. Any way I wrap my mind around this, it doesn’t make any sense.

The best I can do is “OK, the landlord is esentially a small business owner, and perhaps he should be able to get a better rate loan through a Small Business Administration (SBA) program”. But Fannie and Freddie??? What in the world Fannie and Freddie have to do with it?