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If there were no GSE's, housing prices would tumble. Simple economics.
Residential housing has been the backbone of the US economy for 70 + years. The GI bill enabled veterans to buy with no money down. FHA enabled the masses to buy with a minimum down payment. It put America back to work.
The US ranks # 37 in terms of home ownership at 64.5% (2013) compared to nearly 70% in 2005. This is the percentage of homes occupied by the owner, not the percentage of adults who own their own home.
As an aside, Romania has the highest home ownership rate at 95.6. This is the result of mass privatization in the early 90's from state to private ownership at give away prices. 40+ % of these homes have no indoor plumbing, let alone electrical power. Many of the beneficiaries of the giveaway do not have the means to maintain, let alone update their homes or pay property taxes. I digress.
Without GSEs it's likely there would be no 30 year fixed rate mortgage and more people would become permanent renters. Housing would likely trend corporate-owned with your rent check made out to a private equity firm, like Blackstone Group. The irony.
who's to blame for the mortgage crisis? very simple. morons. people who bought homes they couldn't afford, and signed contracts they didn't read. morons.
It is documented that President Bush wanted an investigation on Fannie Mae and Freddie Mack lending practices but the democrats halted it. Barney Frank and Maxine Waters testified all was well in the mortgage industry .
Bush championed for a super regulator of the GSEs and increased capital reserves.
The Republicans held the majority in both chambers and it went nowhere.
Residential housing has been the backbone of the US economy for 70 + years. The GI bill enabled veterans to buy with no money down. FHA enabled the masses to buy with a minimum down payment. It put America back to work.
The US ranks # 37 in terms of home ownership at 64.5% (2013) compared to nearly 70% in 2005. This is the percentage of homes occupied by the owner, not the percentage of adults who own their own home.
As an aside, Romania has the highest home ownership rate at 95.6. This is the result of mass privatization in the early 90's from state to private ownership at give away prices. 40+ % of these homes have no indoor plumbing, let alone electrical power. Many of the beneficiaries of the giveaway do not have the means to maintain, let alone update their homes or pay property taxes. I digress.
Without GSEs it's likely there would be no 30 year fixed rate mortgage and more people would become permanent renters. Housing would likely trend corporate-owned with your rent check made out to a private equity firm, like Blackstone Group. The irony.
Mortgage money went to people with no jobs. Millions of mortgages never saw the first payment made.. the buyers lived in the house for up to 5 years till the bank foreclosed.
Democrats wanted low income people to be homeowners.. they were so low income they had no income at all.
Mortgage money went to people with no jobs. Millions of mortgages never saw the first payment made.. the buyers lived in the house for up to 5 years till the bank foreclosed.
Democrats wanted low income people to be homeowners.. they were so low income they had no income at all.
Millions of mortgages never saw first payments?
We can agree to disagree. I tend not to view most things through partisan glasses.
Bush could have told his HUD to stick their affordable housing quotas where the shun don't shine. But he did not. Instead, he read the script his people wrote for him and championed for affordable housing.
I don't blame Bush, Clinton, Carter, Republicans or Democrats. ( Did I leave anyone out?)
Barney Frank agreed "the goals ( presumably HUD Affordable Housing goals ) of Fannie Mae and Freddie Mac, the concept of promoting home ownership, was something that contributed to the crisis.
"Very much so," according to Barney Frank. That's significantly more than just a 'contribution.'
Barney Frank knows the truth. And he was one of the major deniers. Why are you still being so willfully blind?
Government degregulation. Greedy banks, realtors and buyers just walked through the door they opened.
You can actually change that first one to regulation. Clinton's congress dictated to lending agencies how they were to go about lending money to homebuyers who couldn't get financing by the rules everyone else followed. They legislated sense out and nonsense in. How were people who couldn't get $30K car loans getting $800K mortgages? I worked for a utility company for a short time back then and saw a lot of houses with little to no furniture. Sure, they had a new Honda in the driveway and were sitting on plastic lawn furniture inside of a McMansion. They couldn't afford lawnmowers or a lawn service so their lawns looked like crap.
They then started walking away. I have a friend who did so because "he owed more for his house than it was worth".
They all should do time in jail as they are criminals. Their cars can be repossessed but eviction takes months; why not just drive away while you still have the car?
We can agree to disagree. I tend not to view most things through partisan glasses.
Bush could have told his HUD to stick their affordable housing quotas where the shun don't shine. But he did not. Instead, he read the script his people wrote for him and championed for affordable housing.
I don't blame Bush, Clinton, Carter, Republicans or Democrats. ( Did I leave anyone out?)
It was the culture of greed and times.
Progressive liberalism sparked it off.
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