New Fannie/Freddie Forms

[J Grant]

I believe that the government hasn't released its ownership of fannie is cause it has been a cash cow in the last, low rates. times. Now, it my be time soon for it to be unloaded on somebody.

If fannie/freddie is a cash cow for govt then we should use that $ to pay down the deficit

From my reading, I understand they are reluctant to release FF for fear of what privatizing it might do to the housing market - that is, tank it, since private mortgage companies likely can not abosur teh risk that Fannie and freddie do wrt granting 30-year mortgages, low downpayments and lower mortgage rates.

Higher mortgage rates and tighter terms would make the affordability of homes an even worse problem.

 

[Terrel L. Shields]

If fannie/freddie is a cash cow for govt then we should use that $ to pay down the deficit

Only in our dreams, you can bet that any such money is spent on new programs that did not exist prior to netting those profits. In reality, I bet we couldn't actually determine where the source of cash is, what agencies get money "borrowed" by accounting procedures and all that complexity needs to be reduced.

I understand they are reluctant to release FF for fear of what privatizing it might do to the housing market - that is, tank it, since private mortgage companies likely can not abosur teh risk that Fannie and freddie do

If Fannie can make money doing it, why can't the private sector?

 

[J Grant]

Only in our dreams, you can bet that any such money is spent on new programs that did not exist prior to netting those profits. In reality, I bet we couldn't actually determine where the source of cash is, what agencies get money "borrowed" by accounting procedures and all that complexity needs to be reduced.

If Fannie can make money doing it, why can't the private sector?

Fannie makes $ , but more importantly can offer certain rates and terms because the govt guarantees the mortgages

When that govt guarantee is gone, and it is just the private market, interest rates will spike, the pool of funding will shrink, and loan terms get tighter. Look at private mortgages - typically a few points higher rate, 5 year balloon payment terms, higher down payments etc

 

[Terrel L. Shields]

, but more importantly can offer certain rates and terms because the govt guarantees the mortgages

If they make a profit, then why can't the private sector do so at a reduced rate? The government may "back" the loans, but when did they ever simply bail them out except when the 2008 crisis hit. And guess what? It wasn't because individual loans caused them to lose money. It was because of all the mortgage-backed securities that they held. Those were what went to nigh zero value and forced FNMA and FREDDY into receivership not the individuals going under. They were clawing back a lot of money from the banks who made lousy loans too. So, it was never about John Doe going under, it was about bad bundled instruments.

In 2008 Fannie and Freddie lost a combined $47 billion in their single-family mortgage businesses, forcing the companies to dig deep into their capital reserves. Nearly half of those losses came from Alt-A loans, despite those loans accounting for just 11 percent of the companies’ total business. But those losses were only the beginning: Between January 2008 and March 2012, Fannie and Freddie would lose a combined $265 billion, more than 60 percent of which was attributable to risky products purchased in 2006 and 2007.​

​

Those risky products were mostly securitization dealing with subprime loans- those bundled Alt-A loans.

 

[shrubberyvaluation]

regressions have a 0, 1 input for items. So, yes for FP, it's a 1, no is a zero. Ditto view and waterfront, vs water view, vs none. These can all be read as zeros and ones for the regression.

So how to differentiate unobstructed views vs winter water views, and waterfront too shallow for a boat differs a lot from waterfront with deeper water.

 

[Terrel L. Shields]

So how to differentiate unobstructed views vs winter water views, and waterfront too shallow for a boat differs a lot from waterfront with deeper water.

yes, no yes no.

Clear view 0, 1
Winter view 0,1
dockable 0.1

My own MLS has listing info as follows. And there are about 6 choice under waterfront. Here lot values are per front foot of waterfront. And you can put the frontage ini as a number.



Bluff Lake Front, Creek, Golf Course Frontage, Highway Frontage, Lake Access, Lake Front - Grand Lake, Lake View - Grand Lake, LkeFront-OtherLakes, LkeView-OtherLakes, None, River Front, River View, Seasonal Waterview

 

[shrubberyvaluation]

yes, no yes no.

Clear view 0, 1
Winter view 0,1
dockable 0.1

My own MLS has listing info as follows. And there are about 6 choice under waterfront. Here lot values are per front foot of waterfront. And you can put the frontage ini as a number.

View attachment 96701

Bluff Lake Front, Creek, Golf Course Frontage, Highway Frontage, Lake Access, Lake Front - Grand Lake, Lake View - Grand Lake, LkeFront-OtherLakes, LkeView-OtherLakes, None, River Front, River View, Seasonal Waterview

Here are some waterfront sales from the past year in Annapolis Maryland with under 50 feet of water frontage.



Here are some waterfront sales from the past year in Annapolis Maryland with 100-200 feet of water frontage.

 

[Terrel L. Shields]

Here are some waterfront sales from the past year in Annapolis Maryland with under 50 feet of water frontage.

View attachment 96712

Here are some waterfront sales from the past year in Annapolis Maryland with 100-200 feet of water frontage.

View attachment 96713

Then you can use front footage as a factor and see if it matters.

 

[RustyTapeMeasure]

So how to differentiate unobstructed views vs winter water views, and waterfront too shallow for a boat differs a lot from waterfront with deeper water.

So yeah maybe they have to do a bit more valuation or appraisal wise per 1 out of 153,000 loans that fit your niche. Point is, appraisal profession is already well into its death spiral for 2-3 years, the continuation is just fine tuning the final pulse of appraising.

 

[Tom D]

The properties at each end of the bell curve, and those with unique expensive features, avm don't work. Avm needs to bracket features to find adjustments.