Fannie Mae Eases Credit To Aid Mortgage Lending

By STEVEN A. HOLMES
Published: September 30, 1999

In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.

Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.

In July, the Department of Housing and Urban Development proposed that by the year 2001, 50 percent of Fannie Mae’s and Freddie Mac’s portfolio be made up of loans to low and moderate-income borrowers. Last year, 44 percent of the loans Fannie Mae purchased were from these groups.

The change in policy also comes at the same time that HUD is investigating allegations of racial discrimination in the automated underwriting systems used by Fannie Mae and Freddie Mac to determine the credit-worthiness of credit applicants.

“Fannie Mae, the nation’s biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.”

If anyone wants the 2nd page, I would be happy to copy/paste that too.

Now, looking at the full article, and keeping it in context of this debate, I don’t think anyone is saying that minorities should not buy homes. But, staying with a theme of taking responsibility, no one, regardless of their color/nationality, etc, should be allowed to buy a home they can not afford. And financial institutions should have actuaries that analyse financial risks, and have the power to deny unacceptable loans (with full autonomy from outside pressures including the government). They are not in the business of being “equal opportunity” anything…

The following summary was written by the Congressional Research Service, a well-respected nonpartisan arm of the Library of Congress. GovTrack did not write and has no control over these summaries.

1/26/2005–Introduced.
Federal Housing Enterprise Regulatory Reform Act of 2005 – Amends the Federal Housing Enterprises Financial Safety and Soundness Act of 1992 to establish: (1) in lieu of the Office of Federal Housing Enterprise Oversight of the Department of Housing and Urban Development (HUD), an independent Federal Housing Enterprise Regulatory Agency which shall have authority over the Federal Home Loan Bank Finance Corporation, the Federal Home Loan Banks, the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac); and (2) the Federal Housing Enterprise Board.
Sets forth operating, administrative, and regulatory provisions of the Agency, including provisions respecting: (1) assessment authority; (2) authority to limit nonmission-related assets; (3) minimum and critical capital levels; (4) risk-based capital test; (5) capital classifications and undercapitalized enterprises; (6) enforcement actions and penalties; (7) golden parachutes; and (8) reporting.
Amends the Federal Home Loan Bank Act to establish the Federal Home Loan Bank Finance Corporation. Transfers the functions of the Office of Finance of the Federal Home Loan Banks to such Corporation.
Excludes the Federal Home Loan Banks from certain securities reporting requirements.
Abolishes the Federal Housing Finance Board.

Your mom coming down to the basement and telling you you’re a “Cool Dude” doesn’t count duh.

As you can see, several here are asking for those making this claim to support it by citing or quoting one or more of the “liberals” you are referring to.

I noticed that Duh ran and hid, but now you are carying his water. Where is your link or citation? How do you KNOW this?

In an unexpected twist, it seems many rich white executives profited handsomely from these extremely high risk investments, leaving the bill for us stupid hippies, brown folkses, and other un-”duh”-sirables.

http://www.freddiemac.com/sell/factsheets/alt_stated_income.htm

http://en.wikipedia.org/wiki/Stated_income_loan

http://money.cnn.com/2007/03/19/news/economy/next_subprime/index.htm

A quote from the CNN report: “The loans were very popular with buyers seeking investment property rather than a home to live in.” Does it sound like low income borrowers?

Proof?

I’ll accept the liberal hippie label, but of course I never said any such thing. Bankers were asking for relaxed regulations on loan qualification, and they got them. They should have been careful what they wished for.

But you will be able to cite a “liberal hippie” on the subject, because otherwise you would be exposed as a liar.

Right?

I’m just a silly hippie liberal, but I thought that would be obvious to anyone who has ever raised a child.

It’s like the tree falling in the woods, it’s only a screwup if it costs YOU money, not if it costs a lot of other people money.

So people who had no stake in the consequences of the performance of loans did their best to unload complete turkey loans, collect their commissions, and move on. And the silly fools who ACCEPTED those loans, well, serves them right for falling for such a con job. It’s not the salesperson’s fault that the world is full of rubes who deserve to get fleeced, and the marketplace will correct itself anyway, so there’s no reason to make LAWS about these things.

Of course, that standard is not applied to the banks who bought the worthless loan packages from the con artists with their stockholders’ money. They’re run by really smart people, who DON’T deserve to be fleeced like the rubes taking the loans. Let’s help them out of a situation they had no part in creating.

I am not a financier, so I am not entirely sure how you cover the little guy without a true government buy-out, which is not what happened to Bear. Regardless, I think that short of actual criminal misconduct, the top people are always going to be sure that their “golden parachutes” are well funded….but that is more a matter for the stockholders than the federal government.

Got honesty?

The problem is, the people at the top will make a lot more money than the people at the bottom. It would be better to cover deposits / investments up to an amount instead of essentially given millions to help the people at the top, who are already millionaires.

My point, which you recognize, is that if we let these huge financial organizations go into the tank, it is going to take a lot of money away from people that are patently not millionaires. I guess Oliver is willing to let a lot of regular guys lose a lot of money so he can “stick” it to the 15-20 people at the top. Sure, cut off your nose to spite your face.

My main point is that people like Oliver routinely argue both sides, especially in hindsight. The “liar” loans etc were developed because the banks figured they would make money with them, and the liberals squawked if anyone suggested that perhaps not everyone should be eligible for loans. You can’t have your cake and eat it too.

And for the sock puppet “whoisduh”
http://hispanicpundit.com/2005/11/22/europe-vs-usa-in-treatment-of-minorities/

There, now you have beclowned yourself for the day, time to come up with another screen name.

And Oliver, when did I ever declare myself a doctor?

Exactly. The people in charge only care about short term, because when they shit hits the fan, they will still have all the money they made.

CEOs don’t care about long-term damage, because they can always leave before that happens.

And if the shit hits the fan so fast and in such a huge amount, well, they can always whine to the government and get a bailout. But don’t talk about regulations, that big government socialism.