The Return of the $1,000 Down Mortgage

[What_Goes_Up]

washingtonindependent.com/93795/ … n-mortgage

The Return of the $1,000 Down Mortgage
8/5/10
By **Annie Lowrey **

Fannie Mae and State Housing Agencies Are Offering Little-Money-Down Mortgages. But Why?

“Buy new with $1,000 down,” the advertisement says, the words resting atop a trim green clapboard house offset by a bright blue sky. “The time has come. Stop wasting rent check after rent check and start building equity in your own home. And with only $1,000 down, affordable monthly payments and no private mortgage insurance required, the dream is closer than you think.”

It sounds too good to be true. But it is true. This offer does not come from a subprime lender, looking to reel in thousands of unqualified and ill-advised homebuyers, only to slap them with add-ons, fees and variable rates. It is not a teaser or a trick. The advertisement references a program initiated by the National Council of State Housing Agencies and Fannie Mae, the taxpayer-backed, government-sponsored enterprise that buys up mortgages from lending banks.

The pilot program is called “Affordable Advantage,” and it has now been adopted by three states — Massachusetts, Wisconsin and Idaho. (Other states, such as Pennsylvania, California and Colorado, have similar state programs.) The initiative is small, reaching just a few hundred people so far. But it is looking to expand. Given the dangers of these types of mortgages and the specter of the housing bubble, where unconventional loans wreaked disaster, it is also raising questions from wary housing experts and legislators.

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[What_Goes_Up]

marketoracle.co.uk/Article22620.html

**Zero Down Mortgages Restarted by the Biggest Subprime Lender in Town - Fannie **
Sep 12, 2010 - 10:08 AM
By: **Trader_Mark **

Good news folks… the “no skin in the game” mortgage is back. You know the game right? It’s a one sided bet where the buyer can only win. If the house goes up, you pocket that and hopefully get that granite countertop you so deserve with the home equity. If it doesn’t go up… you walk - but only after living in the home rent free for at least 18-22 months as you strategically default your way to a mountain of savings while waiting for the sheriff to show up. If you are smart you can save at least $30K during this time. There are no losers here (except the U.S. taxpayer). [Jan 5, 2010: WSJ - The Treasury Department’s Christmas Eve Masscare of the US Taxpayer] [Feb 1, 2010: 2 Graphs Showing Part of the Reason for the Christmas Eve Taxpayer Massacre] [May 12, 2010: [Video] Are Losses at Fannie and Freddie Now “National Policy”?]

I could go on and on and on (and on) but let me save my breath - my warnings in late 07 and early 08 about Fanfredron (fannie + freddie + enron) went on deaf ears, so instead I’ll clap and say good on you folks. Buying a $115K house for 67 cents is something our foreign readers must only cry in agony they have no opportunity to do. Those darn French and Germans still have to pay 20% down (snicker).

Can you see the 3 AM informercial now?

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[What_Goes_Up]

nypost.com/p/news/opinion/op … I3sZPkePZI

Building the next subprime crisis
Posted: September 27, 2010
By STEPHEN B. MEISTER

President Obama and Democrats in Congress haven’t moved to stop subprime lending – they’ve just taken it over.

They’ve created a federal subprime-lending monopoly by seizing control of the financial apparatus – Fannie Mae, Freddie Mac and the Federal Housing Administration – and lending 100 percent of the home price to borrowers who can’t afford it.

Private lenders can’t make these loans – they need to get paid back.

On Sept. 9, I reported that Fannie had forged a subprime partnership with state housing-finance agencies called “Affordable Advantage”: Fannie agreed to buy loans from housing-finance agencies for which the buyer puts down $1,000 or less – in at least one case, just 67 cents.

On Sept. 15, the House Government-Sponsored Enterprises Subcommittee held a hearing on Fannie and Freddie. Since these two GSEs have cost the taxpayers $148 billion (so far), Reps. Spencer Bachus (R-Ala.) and Judy Biggert (R-Ill.) took their regulator to task over Affordable Advantage.

Edward J. DeMarco, head of the Federal Housing Finance Agency, sheepishly replied, “This one got away from us” and then promised “you won’t be hearing about additional programs such as this.”

But DeMarco also testified that Fannie’s contracts to buy these zero-down loans from HFAs don’t expire until next March – and he can’t tell Fannie to stop.

Baloney. Obama controls the GSEs – they were seized by Bush and placed in federal conservatorship; Obama OK’d $42 million in bonuses for their top brass last Christmas. They’re making subprime loans because the boss wants them to.

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