An adjustible floating rate mortgage could sink your ship of state. But don’t count on the government bailing you out….

An adjustible floating rate mortgage could sink your ship of state.  But don’t count on the government bailing you out.  Those working in Rome on the Potomac believe that the free-market system only exists to prey upon borrowers.   Nevermind the fact that borrowers were the beneficiaries of five years of artificially low rates….

“Most of the other bills are still in planning stages, like numerous measures to regulate and penalize mortgage lenders who engage in predatory lending. Schumer acknowledged, however, that it won’t help anyone already suffering with a bad mortgage.

“This won’t do anything about what happened in the past, but it will prevent the present crisis from getting worse, because mortgage brokers are still preying on these people,” Schumer said.”
http://biz.yahoo.com/ap/070903/risky_mortgages_congress.html?.v=1

“Bad” mortgages or not, private equity sources know how to do due diligence on vetting potential subprime borrowers.  We don’t just need a return to the liquidity in the credit market, we need a return to common sense in lending without government interference.

Correct me if I’m wrong but am I seeing another bad banker news release coming from the Hill?

Frank Statement on the President’s Remarks on the Mortgage Markets
Washington, DC – Rep. Barney Frank (D-MA), Chairman of the House Committee on Financial Services, today offered the following statement in response to President’s address on problems in the mortgage markets:

“I welcome the Administration’s recognition that a greater public response is required and I look forward to working with them because I agree with a number of specific things that they propose. The Financial Services Committee has already advanced legislation, including a GSE bill that awaits Senate consideration, and we hope to send the FHA bill over soon.  We also are working with the Ways and Means Committee to address the tax issues involved.  However, there are some points of difference that we will need to work out going forward:

With regard to the FHA, going forward, I don’t think that working people and lower income people who are making payments to the federal government should be charged more than others. 

Second, I agree that the rules that regulators have developed for banks have been good ones, but I believe that federal action is necessary to apply them to all originators and the time for further study is over.

Third, there should be some rules to provide some quality assurance to investors in the secondary market. At his speech in Jackson Hole, Federal Reserve Chairman Bernanke noted the need for modification of the securitization process to provide greater investor protection and increased incentives for responsible lending. I believe that well- drafted legislation is essential to achieving this. 

Next, I continue to believe that the portfolios of Fannie Mae and Freddie Mac can play a bigger role than they are currently are playing, particularly in helping the refinancing of subprime mortgages that are about to experience significant interest rate increases.  I believe that the Administration’s objections to this are not based on safety and soundness grounds, but represent their one remaining ideological refusal to recognize the need for a greater institutional role in this regard. 

Finally, there needs to be a federal role in the construction of new affordable housing and preservation of existing affordable housing.”
http://www.house.gov/apps/list/press/financialsvcs_dem/press083107.shtml

For more information about HR1852, The Expanding Homeownership Act of 2007, please click on the following link:

http://www.house.gov/apps/list/press/financialsvcs_dem/press050307.shtml

For more information about HR1427, The Federal Housing Finance Reform Act of 2007, please click on the following links:
http://www.house.gov/apps/list/press/financialsvcs_dem/press032907.shtml 

http://financialservices.house.gov/index.shtml

Best in Success,
Maria Fee
REMI KNOX, LLC
Trading Financial Futures TM
281-346-0400   BUS  |  EMAIL   MariaFee@REMIKNOX.com
866-871-5914   BUS  | 
281-346-1300   FAX  |  WEB     www.REMIKNOX.com
 
Be your OWN BOSS! PART TIME NOTE BROKERING FOR FULL-TIME PROFIT.
Visit http://www.reminote.com/brokernotes.php.

Going in the Hole at Jackson Hole, Wyoming

Going in the Hole at Jackson Hole, Wyoming

“At a central bankers’ symposium in Jackson Hole, Wyoming, Federal Reserve Chairman Ben Bernanke made clear that he was following what analysts have described as a “tough love” policy toward borrowers and especially toward lenders.” 

And thus begins the Federal Reserve System’s disorderly capitulation and rhetorical spin in reversing their two year long course of previously removing of liquidity (tighting the money supply) from the market and now in a mad rush to reinflate the banking system to stabilize the credit markets.  There is panic out there folks and Wall Street did it.  Now the credit crisis contagion has spread to Main Street in the form of tighter mortgage markets.  Regular homeowners looking to move or take a better job will not be able to sell their homes as they once thought.  <Owner Financing anyone?>

When the Reuters business desk writer Tabassum Zakaria says:

“Bush urged lenders to work with homeowners to renegotiate their mortgages to prevent default.  He called on Congress to approve legislation he proposed last year to modernize the Federal Housing Administration, which provides mortgage insurance to borrowers through a network of private sector lenders.”

…. I can’t help but think that Federal Reserve Chairman Ben Bernanke is ordering all the government arms under his control to rearrange the deck chairs on the Titanic.  Modernizing the FHA will not speak to the problem that is in the wider market now that subprime collateralized debt obligations (CDOs) genie is out of the bottle.  The financial draft horses have fled the barn and no amount of  barn”modernization” will get them back.

This business writer goes on to report:

“The FHA will soon launch a new program called “FHA Secure” to allow homeowners with good credit history, but who cannot afford their current payments, to refinance into FHA-insured mortgages, Bush said.  “This means that many families who are struggling now will be able to refinance their loans, meet their monthly payments and keep their homes,” he said.  Bush also pledged to work with the Democratic-controlled Congress to temporarily reform a key housing provision of the federal tax code to make it easier for homeowners to refinance their mortgages.”

But wait a minute?  I thought they just reported that President Bush said certain homeowners were not able to afford their current payments and now we’re going to refinance them so that they can go into deeper debt by postponing their foreclosures?  That is a curious way to put off the inevitable until the next election cycle!

Repeat after me, I’m from the government and I’m here to help you….

You can read about it here:  http://biz.yahoo.com/rb/070831/bush_subprime.html?.v=9

Best in Success,
Maria Fee
REMI KNOX, LLC
Trading Financial Futures TM
281-346-0400   BUS  |  EMAIL   MariaFee@REMIKNOX.com
866-871-5914   BUS  | 
281-346-1300   FAX  |  WEB     www.REMIKNOX.com
 
Be your OWN BOSS! PART TIME NOTE BROKERING FOR FULL-TIME PROFIT.
Visit http://www.reminote.com/brokernotes.php.