Comments on: Conforming Loan Limit Increase in Jeopardy

By: Devin Hester

Devin Hester — Thu, 07 Feb 2008 02:23:39 +0000

Come on people, FNMA is traded on the stock market! The only reason the gov’t bails these guys out is because of votes. Sure it’s a GSE but it is still private. As far as the tax payers eating the defaults if the loan limits are raised is bull!@#$. Really how many people in this country (percentage) have mortgages over 417K? Not that many) If you offer relief to these few folks with the means to pay big bucks for homes it will help the overall picture in our economy. The values of homes and stock are based purely on perception. Since the media had nothing else to report to sell papers they start stirring up all of this negative publicity. As a result we have this mess on our hands because it feeds off of itself.
I think this is an intelligent move to reduce the heavily weighted foreclosure market and will help speed up the process of market stabilization in our larger economies.
I personally don’t like the feds dropping rates all of the time to “fix” this crisis but since the government will spend every cent they get inefficiently anyway, this may be the best bang for our buck in years. I have dealt with many gov’t employees who “have to” spend their annual allowance even if they don’t need anything or they risk losing their yearly appropriations. This is the kind of stupid gov’t waste we deal with every year. Again, if they are going to blow all of the tax money they get then at least somebody will get a direct benefit.
This crap will work itself out in a couple of years. Those who say we have too much inventory to clean up in a couple of years are not looking at the economy as a whole. Since our dollar is so weak foreigners are driving demand for American made products. With this kind of profit flowing into our companies it creates jobs, increases wages because employers must offer these things to hire and retain good skilled workers. I don’t know about you but if I start getting raises and live in an apt. I am going to start seriously considering buying a home ESPECIALLY when the prices have dropped and the rates are still sweet. Wake up, smell the coffee and quit listening to idiots like Tom Sullivan and Suzy Orman who have this cookie cutter approach finance solution for everybody. Read the Wall street journal then read a liberal publication and make a truly informed opinion.

By: Sven

Sven — Tue, 29 Jan 2008 22:56:17 +0000

Prospective buyers is CA & FL should call their senators & congresspeople…to tell them to NOT increase the conforming limit. Leaving it where it is is the only way prices will fall to were they SHOULD be – and to where normal people in those locales could afford to buy…

By: Don

Don — Tue, 29 Jan 2008 17:03:49 +0000

Yay!!! An Island of Sanity here! I agree and so do a lot of my mortgage peeps. I’ve already heard “mortgage professionals” tell agents to call their senators to pass this.

STOP THE INSANITY!!!

It’s rewarding really bad behavior and keeping prices inflated and unaffordable.

MORE OVERSIGHT, PLEASE!!!!!!!!!!!!!!

By: Morgan

Morgan — Tue, 29 Jan 2008 07:57:03 +0000

I agree – the GSE’s have enough problems right now without trying to prop up a deflating bubble by increasing risk to the rest of America for the sake of 4 states in the Union.

By: B

Tue, 29 Jan 2008 07:51:52 +0000

Sanity Prevails!!! Or is at least trying to.

No government bailouts for the corrupt!

By: Angelo

Angelo — Tue, 29 Jan 2008 02:56:09 +0000

HIP HIP HORRAY!!

By: Tom

Tom — Tue, 29 Jan 2008 01:55:33 +0000

Mortgage guy – I’m with you. While it would help people in Florida and California, it wouldn’t make much of a difference in Michigan (where I am). Please I’ve read some things that say that raising conforming loan limits would raise rates. Check out what Paul Jackson says at http://www.housingwire.com http://www.housingwire.com/2008/01/27/tainted-tbas-conforming-limit-increase-may-increase-mortgage-rates/

By: the mortgage guy

the mortgage guy — Mon, 28 Jan 2008 23:27:43 +0000

As a taxpayer I laud the Senator’s position. What sense does it make to transfer the risk from banks and investment companies to the taxpayer. In essence, raising the limit makes the taxpayer the subprime/alt A lender of choice. Furthermore, the GSE’s could definitely use more oversight.

As a mortgage guy, it’s just one more product not on the shelf. It stinks but I think leaving the limits alone is what is right for the country’s taxpayers.

By: CA MB

CA MB — Mon, 28 Jan 2008 22:05:39 +0000

Stated income fraud is too easy with conforming loans that use the automated underwriting computer programs.

Most people now know what a stated income loan is, and how they were used to fraudulently inflate income on loan applications. What most people outside of the industry do not know is that many of Fannie Mae’s loans are stated income but they call them full doc?!? How can that be…. that just does not make sense, right? Brokers and Bankers for the past few years are usually forced to “import” the loan application into a computer program to underwrite the loan (called desktop underwriter/ originator or DO/DU). Through trial and error over the years (and with help of bank employees) brokers and bankers have learned to “massage” the application so that the response we get from the computer program will not require income documentation (this makes a stated income loan, but with interest rates the same as full doc, so they call it full doc)

At first when I know you could have submitted the loan around a dozen times before being “locked out”… I dont know how many times you can re upload now, but most processors know what will fly, and what will not