GOP's DISINFORMATION CAMPAIGN ON SUB-PRIME
So, listening to King George, there are "some people" who were speculators and there were "some people" who are credit worthy and there are "some people" who ...
You'd think that there might be equal amounts of all these people, if one were fool enough to take facts from this White House.
- There were probably over 50% of people put into subprime loans who could have gotten better mortgages. I'm still waiting for someone with oversight responsibility to come up with the full set of statistics (at least I haven't seen it yet, which doesn't mean it doesn't exist).
- Some estimates suggest that fewer than 3% of home buyers got a new home because of sub-prime lending. Therefore, the notion that "some people probably don't belong" is close to 97% canard, when advanced on that basis alone.
If you don't believe me, then ask yourself, what does the lender, who arguably should shoulder some responsibility for a bad credit decision, pay as a price when you help the borrower to refinance 100% using government guarantees/programs, via FHA or otherwise, that they couldn't "normally" use?
When we talk about expanding FHA lending in obtuse ways (and raising caps for "jumbo junk"), yes, we most certainly are talking about a lender bailout ... If you don't believe me, then ask yourself, what does the lender, who arguably should shoulder some cost for a bad credit decision, pay as a price when you help the borrower to refinance 100% using government guarantees/programs, via FHA or otherwise, that they couldn't "normally" use?If you come up with "nothing much", then you might see the point.
[Note, refinance is different than allowing Freddie/Fannie to buy up securities in the secondary market in greater quantities, which might be helpful ... we'll see, the Fed is sort-of testing the waters for that with its new auctions-for-deadbeat-lenders].
TOWARDS A NON-BUSH WORLD VIEW
The consumer advocacy group before Congressman Frank's committee recently opined that the single best thing that could be done would be to give Judges authority to modify mortgage terms. No questions to the President about that from the "liberal media" today...
