Why Are Fannie And Freddie In Such A Hurry?

[djd09]

The truth of the matter, putting any coincidences aside, is the AMCs know they are not paying C&R and need to change the game to stay relevant. Save all your invoices.

 

[djd09]

Which one should we favor moving to Cleveland?

Fannie and REVAA will be located so close to each other, that if they were to start blowing kisses at each other out their windows , spit would get in their eyes.

 

[hastalavista]

If lenders all get the latest tech to match each other' s speedy service to borrowers they end up back in the same boat-offering similar service and products to a finite pool of borrowers at any given time.

The end result is equilibrium.
But before every lender offers the same thing, some lenders are going to get out in front (look at Quicken Loans and its Rocket Mortgage program). So there are competitive reasons to be first.
And before someone misquotes me, I am not saying those competitive reasons should outweigh prudent lending requirements.
I am saying that there is an obvious business reason for wanting to beat your competitors in offering whatever it is the consumer wants/responds to. If I cannot grow the total transaction pool, then I'm going to want to grow my market share.

 

[Evincere]

https://www.consumeraffairs.com/finance/quicken_loans_mortgage.html

Per a borrower, she paid $500 for an appraisal.

Someone else can do the math. They send out offers for $340.

So if they can get an appraisal done for $160, and considering the volume they do per year... that is a lot of additional income/profit to off set the slowing mortgage market.

I call them Ouickie company.

Their commercials ( contrary to their reviews) remind me of the pharmaceutical company’s miraculous drug advertisements.

And the scenarios of happy, smiling people cavorting hand in hand through a valley of beautiful spring flowers with the wind blowing through their hair. The crippled in pain can walk again, the blind can see and the deaf can hear! .

And Near the end of the commercial, warnings about possible side affects such as kidney and heart failure, liver disease, high BP, cancer, diabetes, retina displacement, death, etc etc are rattled through like an desperate auctioneer in a hurry to get to the potty.

 

[J Grant]

The end result is equilibrium.
But before every lender offers the same thing, some lenders are going to get out in front (look at Quicken Loans and its Rocket Mortgage program). So there are competitive reasons to be first.
And before someone misquotes me, I am not saying those competitive reasons should outweigh prudent lending requirements.
I am saying that there is an obvious business reason for wanting to beat your competitors in offering whatever it is the consumer wants/responds to. If I cannot grow the total transaction pool, then I'm going to want to grow my market share.

I understand that. But why is Fannie upending their prudent lending and evaluation policies to facilitate companies like Quicken grow their market share ? Yes times change and technology blah blah, but mortgage loans are 15-30 year commitments of hundreds of thousands of dollars not ordering socks from Amazon. The folks who rush into borrowing can have their financial well being impacted.

There's a saying "there's never time to do it right but there's always time to do it over".

Trailing the digital zing of mortgages with docs no in person closings and quickie inspections of properties are hackers and scammers. There has already been a scam of fraudulent mortgages under fake "borrowers " reported this year.

 

[Evincere]

Yep, we get it djd, it is all one big conspiracy...Frankly, I am surprised that the big bankers and their thugs have not "disappeared" you yet for exposing the conspiracy.

What? TARP didn’t twist bankers arms?


https://www.forbes.com/sites/steveforbes/2013/04/17/federal-reserve-plays-partisan-politics/


As to the robber bank barons and their thugs? Just one of many examples.

https://www.rollingstone.com/politics/politics-news/gangster-bankers-too-big-to-jail-102004/

 

[djd09]

https://www.rollingstone.com/politics/politics-news/gangster-bankers-too-big-to-jail-102004/

"That nobody from the bank went to jail or paid a dollar in individual fines is nothing new in this era of financial crisis. What is different about this settlement is that the Justice Department, for the first time, admitted why it decided to go soft on this particular kind of criminal. It was worried that anything more than a wrist slap for HSBC might undermine the world economy. “Had the U.S. authorities decided to press criminal charges,” said Assistant Attorney General Lanny Breuer at a press conference to announce the settlement, “HSBC would almost certainly have lost its banking license in the U.S., the future of the institution would have been under threat and the entire banking system would have been destabilized.”

FUD.

 

[djd09]

 

[hastalavista]

I understand that. But why is Fannie upending their prudent lending and evaluation policies to facilitate companies like Quicken grow their market share ? Yes times change and technology blah blah, but mortgage loans are 15-30 year commitments of hundreds of thousands of dollars not ordering socks from Amazon. The folks who rush into borrowing can have their financial well being impacted.

(my bold)

Explicit in your question is that there is some nefarious reason for Fannie to upend prudent lending policies to facilitate companies to grow their market share.
If that is your position, that's fine. But the response to your question is,

"We are testing and continue to test these ideas, and we are monitoring the ones we've adopted. We don't see the risk-threat that some others do, and so far, neither do our regulators. As far as adopting technology to speed up the process, that is very important to the borrower and to the lender. So, for those things that technology can speed up without adding undue risk, we'll take a look at it."​

As I've said over and over again (not directed at you): If one thinks any changes the GSEs or lenders in general create undue risk, then organize and make the argument to the regulator. So far, the regulator (whose primary responsibility is to ensure imprudent risk and lending decisions are contrary to lending policy) don't see the same risk-threat as many others. At least not for those programs that are in testing or have recently been adopted.

Naturally, some will argue that regulators cannot be trusted either. Ok:
Cannot trust Fannie/Freddie.
Cannot trust their regulators.
Cannot Trust TAF.
Cannot trust the public to know any better.
Cannot trust politicians to make necessary changes.
Cannot trust lenders who sell to Fannie/Freddie.
Cannot trust real estate agents, as they are all about closing the deal.
For a fact, cannot trust AMCs.
But, of course, you can trust appraisers.

I'm surprised as many appraisers stay in this profession considering how nearly everyone else in the process cannot be trusted.

EDITED (to add "TAF")

 

[djd09]

Independent means not controlled by others and self governed.

TAF should be found unconstitutional too. How long has Bunton been President? Forever? Almost like a dictator.

https://collateralrisknetwork.com/david-bunton/