Posts Tagged ‘ Freddie Mac ’

Real Estate 360 Live With Louis Cammarosano 11/5/12

On Monday November 5, 2012, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate 360 Live radio show on The Big Talker 1580 WHFS AM, hosted by Ryan Sloper.

Listen to the show.

Part 1 (14:27)

Louis and Ryan discuss the recent Hurricane Sandy and the need to be prepared in advance for natural disasters.Ryan and Louis make predictions on who will win the election.

Ryan brings up the potential for the mortgage interest payments deduction to be abolished and the impact that it might have on the real estate market

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Posted by: Louis Cammarosano on November 25th, 2012 under Louis Cammarosano on Real Estate Radio

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Refinance Rates

As of now, the housing market offers some of the lowest refinance rates ever. These exist due to a combination of the state of the world financial markets and due to the policies of the United States government. In this season of political change, though, there are a number of proposals and political realities that could change the atmosphere greatly for homeowners looking to replace their mortgage with a more attractive one.

The Abolition of Freddie Mac and Fannie Mae

Government-sponsored entities, frequently referred to as the “GSEs,” are currently responsible for 90 percent of the money that gets lent out as mortgages, based on an article in the New York Times. When a homeowner gets a mortgage, their lender sells the mortgage to Freddie or Fannie. Freddie or Fannie then package large blocks of mortgages into bonds, and sell the bonds on the global financial markets to investors. Since bonds issued by Freddie and Fannie carry an implicit guarantee from the U.S. Government, investors will buy them at low rates of interest, making it possible for mortgages to be made at very low rates.

Politicians ranging from Barack Obama on the left to Ron Paul on the right have called for the abolition of these organizations. The problem with them is that they expose the government to a great deal of risk, since the government is ultimately responsible to bail them out. In addition, their role in the market distorts the true market for mortgage debt. If their role is abolished or cut back, private mortgage lenders will make more, if not all, of the loans in the market. They will likely demand higher rates of return on safer investments, leading to more expensive refinances at less attractive terms.
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Posted by: HG Blog Admin on February 7th, 2012 under Financing, Mortgage and Home Loans

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Real Estate 360 With Louis Cammarosano 1/9/12

On Monday January 9, 2012, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate 360 radio show on The Big Talker 1580 AM, hosted by Ryan Sloper.

Listen to the show.

Part 1 (14:56)

Ryan and Louis offer their predictions for 2012 on the general economy, real estate market, interest rates, the presidential election, the price of gold oil and silver and foreclosures. Louis notes that the beginning of the year will be a continuation of low interest rates, working off inventory and a tepid market but predicts a financial shock at some point in 2012 perhaps based on a European debt crisis or something in the US.

Louis notes that there is no way to solve the housing crisis or the general sovereign debt crisis other than to allow the debt to be liquidated, but notes that the central banks are not willing to allow it.

Ryan notes of a new tax on mortgages that helps Fannie  Mae and Freddie Mac which Louis characterizes as a back door bailout of these entities.

Louis notes that many home buyers are holding off on purchasing a home because they think interest rates might go lower or that they will stay low for a long time or that home prices will fall further. Louis notes that more likely rents will rise and that it makes sense to get a long term low interest rate to protect against the rise in the real cost of shelter.

Louis notes that if interest rate rose it would be a disaster for the US government  as it would make it even more difficult for the US to pay off the interest. Louis notes that the Fed’s operation twist is intended to keep long term interest rates down. Louis notes that institutional investors purchase US government bonds for their perceived safety. Louis notes that the US is actually printing LESS physical currency as the cost of paper and its components (cotton and ink) are getting more expensive.

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Posted by: Louis Cammarosano on January 28th, 2012 under Louis Cammarosano on Real Estate Radio

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Real Estate Radio With Louis Cammarosano 11/14/11

On Monday November 14, 2011, Louis Cammarosano, General Manager of HomeGain, was a guest on the Real Estate Radio show on The Big Talker 1580 AM, hosted by Ryan Sloper.

Listen to the show.

Part 1 (15:00)

Ryan notes a curious answer by Newt Gingrich about housing during the recent Republican debate. Louis notes the problem of having a real debate with nine candidates in an hour and noted Ron Paul, for example only spoke for 90 seconds in the most recent debate.  Louis notes that there is no free market in real estate as the government is so involved in the real estate market. Louis notes the absurdity of giving the executives of Freddie Mac and Fannie Mae bonuses.

Ryan discusses the issues that Private Mortgage Insurance companies are having and their impact on Freddie Mac and Fannie Mae. Louis notes the analogy during the financial crisis when AIG was unable to meet its insurance obligations to Goldman Sachs and the Fed had to bail them out. Louis notes that the government caused the housing bubble with low interest rates.

Louis notes that the government also causes the cost of education to go higher by guaranteeing loans. Louis note that when the government sponsors services by guaranteeing loans, prices go higher but the quality does not go up. Louis notes that students with excessive loans will have a hard time getting a job and even if they get one will have a hard time getting a loan to buy a home. Louis notes that 70% of the U.S. economy is based on spending-spending with borrowed money. Continue reading this post

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Posted by: Louis Cammarosano on November 23rd, 2011 under HomeGain on Real Estate Radio, Louis Cammarosano on Real Estate Radio

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NAR: How About a Common Sense Approach to Credit?

Want to give an immediate boost to housing sales? Ron Phipps has a suggestion: Mortgage lenders should look beyond borrowers’ credit scores.

Phipps knows of what he is talking. He’s the president of the National Association of REALTORS and the broker/owner of Phipps Realty in Warwick, R.I. He says that home sales would quickly rise if mortgage lenders used just a bit more flexibility in deciding which borrowers qualified for mortgage financing.

Phipps told me during a recent phone interview that Fannie Mae and Freddie Mac are now looking for borrowers to have FICO credit scores of just under 760. That’s a big change from the days when credit scores in the high 600s were considered strong.

It’s true that borrowers can get conventional mortgage financing with credit scores lower than 760. They may, though, have to pay higher interest rates. And these higher rates might knock some buyers out of the market.

“That 760 score is just so much higher than what the average American homebuyer today has,” Phipps said.

Tightening credit standards have played an important part in the housing slowdown, Phipps said. According to data from the National Association of REALTORS, about 15 percent of creditworthy borrowers haven’t been able to get mortgage financing because of the stricter credit-score requirements of Fannie and Freddie.

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Posted by: Dan Rafter on April 19th, 2011 under Financing, Mortgage and Home Loans

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Mortgage Rates are Great but Should We Wait For Home Prices to Drop Further?

Freddie Mac says that we have the lowest mortgage rates EVER!!  Well maybe not ever but since they started tracking the rates.   So maybe in the last 50 years or so…..

Additionally, home prices have dropped to some of the best prices in a long, long time.   So now the question is:  Do we wait to see how low home prices may go before we buy?

Here is some food for thought……

  1. Many people believe that home prices have found the bottom and are making a turn upward.
  2. Mortgage rates are at the lowest rate in 40 or 50 years.  It is hard to believe they will drop any further and are more likely to move upward.
  3. We should look at the math.

What if………
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Posted by: Wayne Long on August 10th, 2010 under Financing, Mortgage and Home Loans, Guest Bloggers

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