Maybe I am missing something but Obama said something interesting in his speech about lowering peoples rates to those that do not qualify. Why does he not pick up the phone and make it happen? 95% of all new mortgages are owned by government and a total of 70% of all mortgages are owned by them through fannie/freddie. I dont understand why people think banks own them as they are only the servicer (collector). Is there some unknown factor I am missing?
Yes, what you didn’t know is that fannie/Freddie can ask banks to buy back the loan if the borrower didn’t meet the qualification standard. It actually happens pretty often, so sometimes bank enforces tougher standard than required to limit their risks. Also, not everyone in government works for Obama, sometimes they have different political backing and goals.
The real reason for the power outage was the part of the speech where he proposed selling San Diego county to Mexico for $400 Billion to offset the cost of the program.
[quote=carlsbadworker]Yes, what you didn’t know is that fannie/Freddie can ask banks to buy back the loan if the borrower didn’t meet the qualification standard. It actually happens pretty often, so sometimes bank enforces tougher standard than required to limit their risks. Also, not everyone in government works for Obama, sometimes they have different political backing and goals.[/quote]
Not sure I understand that. How can a loan be given in the first place if the borrower didn’t qualify?
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