Fuck You Freddie Mac

[kaiser soze]

Scum sucking pigs - we need to dissolve the companies that WANT the U.S. to fail.

http://www.npr.org/2012/01/30/145995636/freddie-mac-betting-against-struggling-homeowners

Freddie Mac, a taxpayer-owned mortgage company, is supposed to make homeownership easier. One thing that makes owning a home more affordable is getting a cheaper mortgage.

But Freddie Mac has invested billions of dollars betting that U.S. homeowners won't be able to refinance their mortgages at today's lower rates, according to an investigation by NPR and ProPublica, an independent, nonprofit newsroom.

These investments, while legal, raise concerns about a conflict of interest within Freddie Mac.

[travesty]

Scumbags... I see something like this happening with Student Loans next now that the gubment has taken over the pursestrings on the second big investment of an American's life. Next up to be assumed by Washington will be your car loan and it will just keep going down the line until you you have to ask the Fed if you can bum a smoke. But as always it will be done in the name of "fairness" and "equality" which in Washington both words are pronounced as [pou-er].

[HAL 9000]

The person who wrote the article has got it backwards. What Freddie Mac is (presumably) doing is releasing capital to support more lending.

The article says Freddie Mac is securitizing its loan book and keeping the riskiest slice of the portfolio - that is how securitization works and they tend to keep that last slice because no other entity would buy it (too high risk).

By doing this, Freddie Mac will retain some risks including prepayment risk, but they will can a huge lump of capital which they can then lend to homeowners. This will make it easier to borrow (lower the cost of borrowing) and will help push up property prices. Indeed this is exactly the sort of activity that created the cheap loan / housing bubble situation in the first place that landed us in this mess.

I assume, however, that for political reasons the government is prepared to exchange losses in a pubicly owned company for improved borrowing conditions and property prices.

[abbott]

was this a result of a democrat and/or a republican?

Lets do it again!

[Dorothy Wood]

I don't really understand the article. My brain goes mushy when I try to think about mortgages.

anyway, I don't think everyone can handle home ownership, and I think it's wrong to keep letting people borrow when they've demonstrated that they can't pay.

[M|X|Y]

people can and should buy their own homes. in many cases, with a decent down payment (like 10%) you can own for less than rent. you've gotta (pay to) live somewhere

i think the problem is ignorance on the matter, all around.

either people don't take the time to learn about it and end up paying off someone else's mortgage in the form of rent. or people jump into situations that don't fit their own means, often over extended. and this is the story we usually hear which keeps everyone else in a state of fear about the whole thing.

its does take some researching, but its not something the average person can't understand if they want to

[Dorothy Wood]

well, I'm glad I don't own because I know how stressful it can be. My mom owns two homes (stuck with one she wants to sell so she can move back to the midwest, but can't, because the stupid housing bubble ruined the market in AZ...even though that same housing bubble allowed her to buy the second home), and has owned several in my life time. She has excellent credit and is good at that kind of thing, but I never picked it up.

Living in the city, I only know a handful of people who own their homes. because it costs like $400,000 to buy a 1 bedroom condo. I pay $600/month rent (split between me and my gentleman friend) with heat included. In a neighborhood I could never afford to buy in. My landlady is the only owner, and I think she works really hard and is kind of doing a service by providing homes for people.

and I can leave whenever, with a month's notice. I guess I don't really think ownership is freedom. I don't have a car either. I participate in car sharing. I get to drive brand new cars for about what I'd pay in insurance if I owned one. and I don't have to pay for gas.

I'm not saying that this life is better, it's just a lot less stressful for me. When I owned a car, it was such a pain. I was angry all the time, so I just gave it up. (this is not so easy in places with no public transit, I know).

I guess I just think that Americans live on too much credit. they're asked to buy and own things, when they're not responsible enough to handle it.

I mean, by refinancing and refinancing, "homeowners" seem to be paying rent to banks anyway...but they're paying interest on top of interest.

Like I said, I don't get it...it's a game I don't understand. My dude's been talking about wanting a bungalow, I told him to take care of the buying part and mowing the lawn (I'm allergic to grass). I'll take care of the home improvement.

[HAL 9000]

I guess I just think that Americans live on too much credit. they're asked to buy and own things, when they're not responsible enough to handle it.

I mean, by refinancing and refinancing, "homeowners" seem to be paying rent to banks anyway...but they're paying interest on top of interest.



I think you are totally right. At the moment, with interest rates very low, it is generally cheaper to buy than rent, but when rates go back up, then renting looks even more attractive.

Then, as you say, renting gives you much more freedom, you can move easily and someone else is taking all the risk of maintainance and house prices moving against you.

I am a homeowner, I bought an apartment in 2005, and I would be better off now if I had rented and saved my money through some other means (other than investing in my own property). Plus now I need a bigger place cause we have a third child coming and the costs and hassle involved are crazy.

A lot of it is all perspective, I too dont have a car, and could not imagine living with out one before. But now I think car ownership is very bad value indeed. Similarly a lot of people think property ownership is very important, but I am not so sure.

[M|X|Y]

this is a real example i know of,

say the mortgage is $800/month vs. $1300 on rent on a ten year loan:

they are not spending or saving $500 a month ($6000/yr, $60,000/10yrs)... which can be put towards paying off he loan faster or improvements or savings

they walk away with the cost of the place in between 5 and 10 years. in this case $70-100,000. having built capital and credit.

that money can go as a down payment on something larger, maybe twice the price.. paying the same amount as before, or maybe costing 50% more paying half the mortgage as before. if you've put some of the difference between rent and mortgage away, that too can go toward he bigger place, reducing your monthly costs.

this is possible with the right situation.

in renting you get nothing in return after the same amount of time



its ok for people to not want what they feel is a hassle or want the mobility to move but it is possible to do.





the car thing is a separate issue. cars depreciate in value the minute you buy one... yeah they can be a huge drag.

[Dorothy Wood]

Oh, I know there are advantages in some cases. But, I literally pay $3600/year to live where I live (in no way is that normal, I concede). I think that might be less than yearly property taxes.

I'm not against home ownership at all, just against pushing it as the end all be all of human existence so people ruin their finances over it.

[travesty]

Home ownership is a monumental pain in the ass compared to renting. Regardless of current market conditions (which are temporary) real estate has historically been one of the surest ways to increase wealth for an individual and/or family. Done correctly, and sensibly (i.e. within your fookin means) owning your own home is a HUGE step forward in accumulating wealth. The outcomes of generations of Americans have been change because the previous generation of thier families finally became home/land owners instead of renters/ leasors. The only reason to put up with the frustration of owning a home is that someday you own it outright and not have to pay anymore. That doesn't seem to happen much anymore as people just keep rolling the equity over into bigger and bigger homes but eventually the equity in a home is going to end up in someone's pocket, hopefully through inheritance and not a bank auction. To each their own... there are many, many days I wish I was renting still. but even more days I'm glad I'm not.

[abbott]

let me tell you where I'm coming from on this...

A. personally responsible for well over $500,000,000 in real estate contracts.

B. Worked in the house in DC.

This is what you get when you don't have term limits on house and senate members and your state is rewarded for having a seasoned member voted in .. a la newt.

[yeahwho]

let me tell you where I'm coming from on this...

A. personally responsible for well over $500,000,000 in real estate contracts.

B. Worked in the house in DC.

This is what you get when you don't have term limits on house and senate members and your state is rewarded for having a seasoned member voted in .. a la newt.

I don't get what your saying, newt hasn't held any political office since 1999.

[abbott]

10 terms, elected to 11th

[yeahwho]

10 terms, elected to 11th

I don't mean to be splitting hairs but, currently Newt Gingrich holds no political office. He writes books, hangs out in political think tanks and does consulting.

He is not part of any House, Senate or elected office. Just not too sure what effect term limits has on somebody who is currently not holding an elected office.


The time between Gingrich's departure from the U.S. House on January 3, 1999 and his hypothetical inauguration as president on January 20, 2012 would be 13 years and 17 days.

[yeahwho]

I might add, even though I think most all of the candidates are henchmen for corporate America, I like Newt way more than Romney. I think the Republicans are fucking up with Romney.

Not my battle. Gingrich is slimy, but interesting as all get out.

Romney is just slimy.

Newt has a better chance at getting Obama.

[abbott]

I am going to stick my neck out here and say Newt was/is a career politician. Career politicians get paid by failing government owned business all the time and we like it. The real career politician learns they can do more out of office as a consultant than in office with a bunch of constituents and their dam expectations.

the idea of career politicians is the problem. After 7 terms, write some books and funnel money as a consultant from the government, Dam it feels good to be a gangster. I know there are a few good long term guys, but our system would be better off with fresh people/ideas on a regular basis.

this is not the best example, but ...i know a guy who owned a company that lays a lot of asphalt along the US/Mexico border. He has to change out his crews' locations ever 15 days other wise the crews get bought out by the drug cartels. Now I can appreciate that this guy is running a business and trying to make a profit, so it is not exactly like our government, so not the best compression.

We can consult with actual business owners who don't make a living through federal funds, or we can go to the guys who make a living off our taxes.

I don't know why I ever made the original post on thread, I got caught at the wrong time.

[yeahwho]

It's a weird thread anyway.

There is a political push currently underway to establish refinanced mortgages at under 4% across the USA using Freddie/Fannie with loans from conventional banks underway. Saving on average $3000 per year per loan, even for folks whose homes and loans are undervalued by current market values.

That seems like an extremely great idea... people keeping their homes and paying $300 less per month to do so.

So the whole "Fuck You" tone is weird.

[abbott]

drunken post #1268

wish I never posted anything on this. I know nothing.

[abbott]

sorry .. post 593

[abbott]

Freddie Mac Changes Foreclosure Valuing. This sounds good to me.