Cat Man Du
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- Jul 30, 2007
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REDS are my edits !!
As the administration continue to recreate the ponzi bubble using the very same criminal methods that reflated the first housing bubble, more and more homes are being handed back to the original mortgage lenders - Fannie and Freddie (which incidentally are all now owned by everyone in America, ever since the GSEs were nationalized by the US, after Barney Frank's experiment in the early 2000s went so wrong, it nearly cost the default of America. How that human is still allowed to draft law after corrupt and worthless law, is beyond us). And today we discover that at the end of June, Fannie and Freddie are now the proud owners of 191,000 homes (double what they owned at the end of 2009) and rising with each passing day. And shockingly, the GSEs have decided to do the prudent thing and start selling this real estate, before the plunges really plunge and leave them straddled with millions of homes. On the other hand, this action alone will likely be sufficient to force the next leg lower in home prices. Because it gets worse: "Once they take homes back, Fannie and Freddie must not only cover the utility bills and property taxes, but they are also relying on thousands of real-estate agents and contractors to rehabilitate homes, mow lawns and clean pools. Fannie took a $13 billion charge during the second quarter just on carrying costs for its properties." Yes, dear taxpayer, this is money out of your pocket being used to prevent a drop in home prices, so that instead of being able to afford a home at a much lower price, you need to use even more 101% LTV Fannie debt and bid it up at still astronomically high levels, even as Fannie and Freddie become ever more default, so that one day all taxpayers end up with a big fat donut once America's pomzy debt issuance appartus finally implodes.
More from the "http://online.wsj.com/article/SB10001424052748704652104575494123756247944.html":
Two years after they were taken over by the federal government, Fannie Mae and Freddie Mac face a new challenge: The mortgage-finance giants are becoming two of the nation's largest home sellers at a time when the housing market shows new signs of softening.
Fannie and Freddie have already taken back nearly as many homes in the first half of the year as they did all of last year. They owned more than 191,000 homes at the end of June, double the year-earlier total. That number will grow because they are taking back homes faster than they sell them.
In recent weeks, Fannie Mae has warned that it could get tougher on lenders that are taking too long to reclaim homes once they have determined that the home is vacant or once they have exhausted foreclosure alternatives, such as modifications. Mortgage servicers, which collect fees from Fannie, could face fines if the process is unreasonably prolonged.
Fannie's recent reminder to banks signals a growing impatience with delays that have become "exaggerated and unmanageable," says Edward Delgado, a former Wells Fargo & Co. executive who is now chief executive of the Five Star Institute, a provider of training programs for mortgage professionals.
Fannie is effectively saying "we need to jumpstart the system. We need to be more expedient," Mr. Delgado says.
While it is expensive for Fannie and Freddie to hold on to more unsold homes, they nevertheless want to avoid costly delays. Attorneys' fees can pile up and vacant homes risk falling further into disrepair. Fannie issued the notice to remind servicers to "minimize processing delays," said a company spokeswoman.
Already, as borrowers fail to qualify for permanent modifications, newly initiated foreclosures at Fannie and Freddie have risen for three consecutive months to more than 150,000 in July, up nearly 60% from April, according to LPS Applied Analytics.
As the administration continue to recreate the ponzi bubble using the very same criminal methods that reflated the first housing bubble, more and more homes are being handed back to the original mortgage lenders - Fannie and Freddie (which incidentally are all now owned by everyone in America, ever since the GSEs were nationalized by the US, after Barney Frank's experiment in the early 2000s went so wrong, it nearly cost the default of America. How that human is still allowed to draft law after corrupt and worthless law, is beyond us). And today we discover that at the end of June, Fannie and Freddie are now the proud owners of 191,000 homes (double what they owned at the end of 2009) and rising with each passing day. And shockingly, the GSEs have decided to do the prudent thing and start selling this real estate, before the plunges really plunge and leave them straddled with millions of homes. On the other hand, this action alone will likely be sufficient to force the next leg lower in home prices. Because it gets worse: "Once they take homes back, Fannie and Freddie must not only cover the utility bills and property taxes, but they are also relying on thousands of real-estate agents and contractors to rehabilitate homes, mow lawns and clean pools. Fannie took a $13 billion charge during the second quarter just on carrying costs for its properties." Yes, dear taxpayer, this is money out of your pocket being used to prevent a drop in home prices, so that instead of being able to afford a home at a much lower price, you need to use even more 101% LTV Fannie debt and bid it up at still astronomically high levels, even as Fannie and Freddie become ever more default, so that one day all taxpayers end up with a big fat donut once America's pomzy debt issuance appartus finally implodes.
More from the "http://online.wsj.com/article/SB10001424052748704652104575494123756247944.html":
Two years after they were taken over by the federal government, Fannie Mae and Freddie Mac face a new challenge: The mortgage-finance giants are becoming two of the nation's largest home sellers at a time when the housing market shows new signs of softening.
Fannie and Freddie have already taken back nearly as many homes in the first half of the year as they did all of last year. They owned more than 191,000 homes at the end of June, double the year-earlier total. That number will grow because they are taking back homes faster than they sell them.
In recent weeks, Fannie Mae has warned that it could get tougher on lenders that are taking too long to reclaim homes once they have determined that the home is vacant or once they have exhausted foreclosure alternatives, such as modifications. Mortgage servicers, which collect fees from Fannie, could face fines if the process is unreasonably prolonged.
Fannie's recent reminder to banks signals a growing impatience with delays that have become "exaggerated and unmanageable," says Edward Delgado, a former Wells Fargo & Co. executive who is now chief executive of the Five Star Institute, a provider of training programs for mortgage professionals.
Fannie is effectively saying "we need to jumpstart the system. We need to be more expedient," Mr. Delgado says.
While it is expensive for Fannie and Freddie to hold on to more unsold homes, they nevertheless want to avoid costly delays. Attorneys' fees can pile up and vacant homes risk falling further into disrepair. Fannie issued the notice to remind servicers to "minimize processing delays," said a company spokeswoman.
Already, as borrowers fail to qualify for permanent modifications, newly initiated foreclosures at Fannie and Freddie have risen for three consecutive months to more than 150,000 in July, up nearly 60% from April, according to LPS Applied Analytics.
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