[skeeter]

I have also wondered if another piece of the puzzle was the fact that they could make the loan and then move it on to Fannie Mae etc?

This is the intended purpose of FNMA, FHLMC, etc. to provide "liquidity" to the mortgage market & enable primary lenders to move liabilities off their books & make more loans. Of course these lenders will then be less inclined to screen borrowers, ESPECIALLY when the government further mandates they make risky loans in the interest of "making homes affordable to the less fortunate".

They've got to put the "free" back in free market.

[brytlea]

Yes, I know what Fannie and Freddie were for. But, the fact that they never have to worry about collecting the loans has to make them feel pretty safe.
susie