Sub-Prime Mortgages that Led to the Foreclosure Crisis is False [mortgagefraud101.blogspot.com]
Here's the first episode.
mortgagefraud101.blogspot.com Financial Crisis Explained: Subprime Mortgage
Recently SEC (Securities and Exchange Commission) entered into the war against Fannie Mae and Freddie Mac. The commission fielded a legal suit against three of the executive from each of the companies. The charge was that the disclosures they had made were “materially falseâ€Ã‚ regarding the portfolio sizes dealing with sub-prime mortgages.
Robert Khuzami the enforcement chief of SEC said that the action indicted that “all individuals, regardless of their rank or position, will be held accountableâ€. But this statement has to be taken with a pinch of salt because SEC is now playing up the gallery.
The charge is unusually weak. Two scholars of American Enterprise Institute (noted for its conservative leanings), Peter Wallison and Edward Pinto, have concluded that Fannie Mae and Freddie Mac started off the crisis and led the private sector into this quagmire because of their sub-prime lending.
For instance Alt-A loans may have had the appearance of sub-prime mortgages but they were given only to those with high credit scores.
No internal Internet mails have shown that the executives contradicted any of the statements they had made in public; there were no instances of dubitable insider sale of stocks. The financial statement disclosures of Fannie and Freddie clearly indicate that they had been transparent in outlining the credit features of the portfolios dealing with mortgages, although they did not brand any non-traditional loan as sub-prime.
About one year previously a shareholder had brought a suit against Fannie Mae charging the agency for not making proper disclosures; the judge had thrown out the suit saying that the disclosures made on sub-prime portfolio of the firm was adequate.
Default data is missing from the complaint filed by SEC; Wallison and Pinto have ignored this conveniently. The fact is that despite all shortcomings, Fannie Mae and Freddie Mac had some principles about the loans that were non-prime that they made; to prove it they have the default figures. This is the truth.
David Min, criticizing Wallison points out that during the second quarter of last year (2010) the rate of delinquency on all the loans guaranteed by Fannie Mae and Freddie Mac was 5.9%. This can be contrasted with the national average â€" 9.11%.
 Suggest Sub-Prime Mortgages that Led to the Foreclosure Crisis is False Issues
Question by gordons_19: How does the sub prime mortgage crisis in the USA effect BUYER's desire for a rent to own type home purchase? Due to the sub prime mortgage crisis and the general unknown of the USA market right now how does that affect someone who is wanting to buy a home on a rent to own or lease to purchase type purchase? Will people be more interested in getting into their own home on a rent to own or will they be more wary of it because they might end up with a home that has depreciated in value a fair bit? Or do people still see a no money down, no credit check home purchase as their best way to get into their own house regardless if the value drops a bit? Of course, there's a lot more to house value than just the market. So, how does everyone see the popularity of a rent to own home purchase for a potential homebuyer? A good idea for them or not? Thanks Best answer for How does the sub prime mortgage crisis in the USA effect BUYER's desire for a rent to own type home purchase?:
Answer by Gregg
Lease options are a viable option for many these days because it's more difficult to get credit. Best reports say that 10% to 23% of the subprime mortgages will end in foreclosure. The flip side of that is 77% to 90% won't. That means that there is a large segment of the population that, is in fact, able to handle a mortgage and they will now be unable to do so due to tighter restrictions. With a lease option, you also don't have to worry about depreciation because you do not have to exercise the option at the end of the lease. If the house has no equity you can merely walk away. Smart investors see this trend and are providing a much needed niche in the current market. Lease options are a great opportunity for both investor and buyer/tenant in a market that is not conducive to traditional thinking.
Answer by I_Love_McRedneck
There will be a lot more houses on the market that are rent-to-own because people can't get loans these days and therefore sellers can't sell. Be careful - if you have lousy credit & don't clean it up before the lease is up, you'll lose your deposit when you can't get a loan.
Answer by David G
Very indepth question young grasshopper allow the real estate zen offer you some valuable insight... There are many variable to that would go into that question however in general on the broad scope of the country when lenders tighten their belt and home property values drop rents go up. People walk away from the debt because there's no use paying into something that will be a loss especially when they have ARM mortgages therefore independent investors step in. Because of course rents go up so yes there will be more opportunities for seller financing however keep in mind most of those will be limited to professional investors not the guy with a little bit of money who bought a home last year to become rich. He'll be one of the people walking away from the debt. For more info visit platinumreic dot com.
Answer by timpoli
Well, lease options are a viable option for many these days because it's more difficult to get credit. I found interesting information about your answer here. (mortgage opportunitty refinancing ) http://all-mortgage-calculators.blogspot.com/2007/06/mortgage-opportunitty-financing-and.html Good luck!
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