Posted on 06/19/2018 8:38:40 PM PDT by 2ndDivisionVet
Mortgage financier Freddie Mac on Thursday announced a program to help unemployed homeowners find a job, part of the federally required initiative known as “Duty to Serve” that requires Freddie and its counterpart Fannie Mae step up their efforts to serve low- and moderate- income communities.
In particular, Duty to Serve directs the two enterprises to improve their activities in manufactured housing, rural housing and preservation of existing affordable housing.
The new initiative builds on a 2015 pilot program between Freddie and job-placement firm NextJob. That pilot included 700 participants, of whom half were considered long-term unemployed. Qualified participants averaged nearly two years without a job before entering the program, a Freddie spokesman told MarketWatch, but within a few months of completing the program, 43% found jobs.
Freddie will again work with NextJob, as well as local partners including CDC of Brownsville, Texas, and HOPE Enterprise Corporation of Jackson, Mississippi....
(Excerpt) Read more at marketwatch.com ...
They just want a free house, not a job!!
These agencies 100% caused the horrible financial collapse of this county by guaranteeing mortgages of people that could never pay those mortgages!! Total communism. Shut it down. We are broke!!
These agencies 100% caused the horrible financial collapse of this county by guaranteeing mortgages of people that could never pay those mortgages!! <<<
Close but wrong!...the banks wouldn’t do it! so the Govt said you Will..but we’ll cover your loses on the loans and you can keep any profit......Then it was just a question of if the buyers could fog a mirror....
Do your own DD!
every state that i know already has a large employment department, this sounds both like wasteful duplication and a serious diversion of focus (at agencies which NEED TO MAINTAIN FOCUS on prudent lending standards or else they’ll help plunge USA into another depression again)
This is wrong...and Trump ought to end it.
For those who think this makes sense...there’s nothing then to stop the National Park Service, NASA, or US Army from also going out to help unemployed people to find jobs. Maybe we could even get churches, the Boy Scouts, CNN, and the NFL to also help people find jobs.
The diversion of focus would make life in America a joke.
Yes. But bass may still he diverted into becoming a global Muslim promotion bureau ( per obama order). And BSA is too busy nowadays sexually abusing or corrupting the kids to do much else?
The notion that the government forced lenders to loan money is a common misconception.
The CRA was a government agency that offered mortgage insurance to lenders willing to lend in distressed areas. The CRA was a 1976 creation but they never grew very big. Lenders didn’t need their insurance. But they got hammered by people that don’t understand the mortgage crisis.
The cause of the mortgage collapse was allowing investment banks (sharks) to swim into the waters of local mortgage markets. This permission was granted by the repeal of Glass-Steagall in 1999.
Investment banks were allowed to ‘bundle’ mortgage revenue streams from underlying real property loans, bundle them and form a ‘bond’, a mortgage-backed security. There could be 5,000 loans bundled into one bond. At an average house cost of $350,000, the value of the bond would be $1.75 billion.
A mortgage-backed security originator would get the bonds rated and then sell them on bond exchanges. For a $1.75 billion MBS bond, a 6% commission would net $105 million.
Selling numerous MBS bonds every month netted billions in revenue each month. The business was off the scale lucrative.
This business was so hot that greed took over and threw underwriting standards to the wind. Anything that was breathing was signed up for a mortgage loan. And in fact, dead people were signed up as well. Janitors were qualified to buy 5-bedroom homes, maids were known to buy several homes.
The way it worked was that a spreadsheet with fictitious names and addresses were attached to a rated MBS, seasoned and then sold to investors. The MBS bond securitizers would quickly, very quickly dispatch mortgage brokers, many of whom were convicts or employing convicts, dispatch them into cities and towns to find real names and real addresses to backfill the spreadsheet as the bond was sold. This is what caused unqualified people to be able to get loans. The underwriting standards were thrown to the side, out of the way.
GW Bush turned a blind eye. His people would not prosecute Wall St. sharks for their fraud for fear of ‘talking the economy down”. Bush let everyone know that the economy was a most important factor to his administration, hence the SEC, the bank examiners, the CFTC, all of the oversight agencies were told to stand down.
Well said!
Let me get this straight: unemployed yet seeking a mortgage = like wtf is wrong with that math?
Exactly—get the government out of the mortgage (and while you’re at it, student loan) business!
There were millions and millions laid off or wiped out in the financial collapse. Many of them if not most were good Americans that did nothing to deserve the fate that was handed them.
After some years of unemployment, a person becomes de facto unemployable. This is why the Obama unemployment figures were a joke because the workforce participation rate became so low that the employment calculations became a farce.
The Trump Administration is highly supportive of putting good people back to work. After a year or so of solid employment, those people should be able to get back into a mortgage.
The mortgage crisis left millions stranded in default of mortgages. The bank owns the property in most of those cases of default. These homes sit empty and cost a lot to maintain. In many cases, there is no maintenance. The properties are a blight on the community.
The effort on the part of GSEs Fannie, Freddie, to help find employment for those that were thrown out of the Obama economy is a good one. If such persons can reestablish credit, they can possibly qualify for mortgages. The outcome can be a win-win fr all.
Wrong. First, the CRA was not an “agency”. It was an Act. The community reinvestment act. Fanny and Freddie were ordered to guaranty crap loans-mortgages had been sold for decades. The investor .( not just bank) put them in bundles and sold them without recourse. Because of the absolute guaranty and the mandate to get a house to a parasite, millions of crap loans were sold and resold becsause they were GUARATEED with your money!! That’s genius. The insurance also included PMI by AIG. The entire thing was the fault of government policy! The communists tried to blame the banks!! But banks didn’t cause this. The sheep in this country are so easily mislead.
It is a mess but at some point, it needs to be cleaned up. The cleanup has started.
The housing market is headed for a mild downturn as interest rates increase.
During the Obama years, housing prices spiraled up as a result of years and years of low-interest rates.
Many puzzling inconsistencies arose during the Obama years. Builders were able to borrow to build with nearly free money. When projects were completed they sold the projects to holding companies that were, in essence, the banks. The banks had virtually no debt service as the money was borrowed at 0% to 0.25%.
The banks added shiny new buildings and homes onto their balance sheets to account for the free money they borrowed. They hired property managers and found that the best formula for maintenance was to leave most of the dwellings unoccupied, 25% to 45% occupancy rates were not unusual. Then, the dwellings that were occupied would pay rents or mortgage payments at elevated rates so that the banks could pay their minimal costs to service the nearly free money they held on their books and to pay the property managers. The key for the banks was to hold valued assets on their books as they piled on debt. The ironic outcome was a housing shortage with housing costs spiraling upward with record numbers of able people out of work.
The Obama economy was a ghost economy.
Personally, I wouldn’t mind seeing housing values take about a 10% haircut while jobs earn about 25% more than under the Obama economy. The twain shall meet where people get into homes after reestablishing credit. This balance is approaching.
I remember the Reagan years whereby late 1983 and into 1984 in time for his reelection people could ‘feel’ things were improving. He won 49 states in 1984. By 1985 the economy was roaring.
Under the Trump Administration, things are moving in the right direction. After the midterms, into late 2019 and into 2020, people will absolutely feel the difference.
I knew that but I am not parsing words and splitting hairs like you are.
When laying blame, the percentages accrue to the Wall St. banksters with the vast amount of blame. They were corrupt and criminal. These are facts, not opinions. Obama did not prosecute them. He stood down.
The CRA 'agencies' piled on after the banks but accounted for a small percentage of the overall devastation. They had been around since 1976 and had not inflicted the damage the banks were able to inflict in more than 25 years. The banksters were freed up to fleece American homeowners by repeal of Glass-Steagall. It took them less than 10 years to blow up the economy, a repeat of the Great Depression pattern that brought Glass-Steagall in the first place.
President Trump said as Candidate Trump that a new form of Glass-Steagall is needed. He is not seeking to abolish the CRA as that is such a small part of the problem in the bigger picture and there is no real reason to abolish it.
Fannie and Freddie were never ordered, they were pressured but their insurance was not needed so much, they did not account for the vast part of the devastation at the level it happened. They were part of the problem, but a small part of the problem.
The real culprits were Bank of America Securities, Merrill Lynch, Morgan Stanley, Chase, Citigroup, Wells Fargo, and many, many others along with tens of thousands of disreputable mortgage brokers, all driven by greed at money flying off the table.
If you can handle the technical aspects of the mortgage crisis, see the film 'The Big Short'. It does a fair job of showing what was the root of the crisis.
There was also a little-known entity that was positioned at the Hub of the fraud and is under investigation, MERS.
Here's a non-technical analogy that everyday people can understand:
A pet food additive manufacture gets approval to add a new addictive ingredient into the pet food supply. Pets everywhere can't get enough and they start overeating like mad. They eat so much they become addicted. The pet food manufacturers are making more money than ever could be imagined.
When the addictive ingredient was pulled from the market (in the mortgage crisis FHA stood behind 80% of all bank mortgage money approvals and pulled the plug in late 2008 so that by 2009 the banks were not allowed to lend any mortgage money), the pets were left starving. The Humane Society (CRA agencies) had been onboard with the increased pet food supply as pet rescue projects were getting some of the new food supply donated to them. The devastation caused to pets was the fault of the addictive ingredient that was allowed into the food chain by government deregulating the food supply.
As conservatives, we are opposed to EXCESSIVE UNNECESSARY government regulation. But we recognize that government regulation in terms of safety and security is necessary. We seek the proper balance for the role of government. For example, one faulty critical aviation part can bring down an airliner carrying hundreds of people. One lapse in a maintenance program can do the same. The FAA regulations on parts and maintenance are heavy by a necessity for safety.
In the mortgage crisis, the repeal of Glass-Steagall allowed greedy operators, Wall St. sharks to feed on local mortgage markets and the result was the same as it was in the years of the Great Depression.
No, unemployed and already have a mortgage. Something that has happened to millions of people over the years.
You are absolutely wrong. You must be bureaucrat or a bush supporter.? The fault for the collapse was 100% guaranteeing crap loans which were sold based on your guaranty. It was pure communism. It was a disaster of epic purportions and you cannot change the absolute facts. It was shameful and should be taught to small children in school.
Btw, you are no conservative. Banks were not to blame , mam !!
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