not my fault you can't read.. ive posted more times than needed be, and you still don't want to read it... i'm done with your liberalness...

http://thelibertarianrepublic.com/obama-is-trying-to-start-another-housing-bubble/

President Obama is Trying to Start Another Housing Bubble
Chris Johncox
April 6, 2016


President Obama Apparently Wants 2009 All Over Again

by CHRIS JOHNCOX

After the housing bubble of 2009, you’d think many people would learn their lessons that lending money to people with bad credit was a recipe for disaster. On top of that, the government promised to bail out the lenders with taxpayer money should the deal go south, which it most certainly did. Unfortunately, if you’re President Obama, you didn’t learn that lesson even seven years later. The President wants to replicate the financial meltdown because his administration thinks the housing recovery is unfair to certain people.

One of President Obama’s economic advisers, former Federal Reserve Governor Elizabeth A. Duke, said in a speech in Avon, Colorado that the recovery she helped foster now causes banks to avoid lending money to certain high-risk clients. Duke’s explained her reasoning as follows:

Furthermore, when refinancing demand is high, lenders have less incentive to pursue harder-to-complete or less profitable loan applications. In the current environment, refinance applications by high-credit-quality borrowers–many of whom may have refinanced repeatedly as rates have fallen over the past couple of years–are likely the easiest to complete. And refinances under the revised Home Affordable Refinance Program, require substantially less documentation than other loans. It is possible that the abundance of these applications may have had the unintended effect of crowding out borrowers with lower credit scores, whose applications may be more time consuming to process. Indeed, staff research suggests that the increase in the refinance workload during the past 18 months appears to be associated with a 50 percent decrease in purchase originations among borrowers with credit scores between 620 and 680 and a 15 percent decrease among borrowers with credit scores between 680 and 720. Purchase originations among borrowers with higher credit scores appear to be affected to only a small degree.

In short, Duke is saying that since more people are buying homes since the start of the recession, people with poor credit scores are getting a raw deal in the housing market. Duke is ignoring the obvious, of course: their credit scores are bad because they don’t pay back their loans.

It’s not only Duke who came out in favor of the initiative. The Department of Treasury has announced three new steps to improve access to the housing market. They are:

Providing financial incentive to lenders who are faced with a risky loan:
Legislation would facilitate a refinance, whereas under our existing authority, Treasury could only modify the most deeply underwater loans and pay investors for some amount of forgone interest.
Credit repair and financial bailouts to the states hit hardest by the recession:
Our Hardest Hit Funds program, which provides financial support to the 18 hardest hit states and the District of Columbia to develop locally tailored programs to assist struggling homeowners, is gaining traction, and we will continue working with states to ensure that their programs reach those in the greatest need.Additionally, we will look for ways to help consumers repair their credit and regain their footing in the housing market and support neighborhood stabilization.
Reducing the government’s footprint in the housing market by redefining what qualifies as a credible loan:
Moreover, many creditworthy borrowers who are being denied mortgages today had their credit scores damaged because a job loss or reduced wages from the financial crisis caused them to miss an auto or credit card payment…As you know, the Consumer Financial Protection Bureau, along with other regulators, have released a collection of mortgage-related rules in the past several weeks that covers different parts of the mortgage origination chain.

These include requiring lenders to verify a borrower’s ability to repay, setting best practice servicing standards, increasing transparency for appraisals, setting standards around originator compensation practices, establishing escrow requirements, and mandating the provision of disclosures, such as those relating to counseling, to high-cost loan borrowers.

It becomes apparent quickly that the Department of Treasury believes more central planning is what will cure a natural market symptom of people with bad credit not getting a loan. Instead of managing their money a little better in the future, these people will now get loans they can’t afford because their normally bad score is now considered good, and the lenders know that if the clients can’t pay their loan back, the government will do it for them.

Of course, President Obama himself supports the idea that everyone can have it all regardless of how wisely they prepared or how hard they worked. The President promised in his State of the Union address to do whatever he can to ensure that people with bad credit get that loan they can’t afford to pay back:

And part of our rebuilding effort must also involve our housing sector. The good news is, our housing market is finally healing from the collapse of 2007. Home prices are rising at the fastest pace in six years. Home purchases are up nearly 50 percent. And construction is expanding again.

But even with mortgage rates near a 50-year low, too many families with solid credit who want to buy a home are being rejected. Too many families who have never missed a payment and want to refinance are being told no. That’s holding our entire economy back. We need to fix it.

Right now, there’s a bill in this Congress that would give every responsible homeowner in America the chance to save $3,000 a year by refinancing at today’s rates. Democrats and Republicans have supported it before. So what are we waiting for? Take a vote and send me that bill.”

What President Obama wants to see happen is people applying for the loan to be applied at even lower interest rates. He claims not enough people are getting loans because the banks are being too prudish, but now he wants to sign a law that would cause the banks to make even fewer loans. Why would banks want to make loans that they’re getting even less out of? The only way they’d do so is if the government gave them financial incentive to do it, which the Treasury Department already indicated they’d try.

However, arguments for the initiative quote the statistics that new time homeowners account for 10% less of the housing market than they did before the crash. This indicates that because it’s too hard to get a loan, young people are now forced to rent instead of buy, leading to less economic growth.

Ironically, what causes houses to raise so steeply, as with any field, is government subsidization of the supply side. If sellers know they can charge enormous amounts for a house and the buyer will get a loan regardless of their credit score, they will charge much more for a house than they normally would.

We can only hope more people understand that basic premise of economics before there’s another housing bubble.

http://humanevents.com/2012/12/22/new-study-finds-democrats-fully-to-blame-for-subprime-mortgage-crisis/

New Study Finds Democrats Fully to Blame for Subprime Mortgage Crisis

Jim Hoft | Saturday Dec 22, 2012 10:35 AM



In his early activist days, Barack Obama the community organizer sued banks to ease lending practices.

State Sen. Barack Obama and Fr. Michael Pfleger led a protest against the payday loan industry demanding the State of Illinois to regulate loan businesses in January 2000. During his time as a community organizer Barack Obama led several protests against banks to make loans to high risk individuals. (NBC 5 Week of January 3, 2000)

Here’s something that won’t get any play in the liberal media…
A new study by the respected National Bureau of Economic Research found that Democrats are to blame for the subprime mortgage crisis.
Investor’s Business Daily reported:

Democrats and the media insist the Community Reinvestment Act, the anti-redlining law beefed up by President Clinton, had nothing to do with the subprime mortgage crisis and recession.

But a new study by the respected National Bureau of Economic Research finds, “Yes, it did. We find that adherence to that act led to riskier lending by banks.”

Added NBER: “There is a clear pattern of increased defaults for loans made by these banks in quarters around the (CRA) exam. Moreover, the effects are larger for loans made within CRA tracts,” or predominantly low-income and minority areas.

To satisfy CRA examiners, “flexible” lending by large banks rose an average 5% and those loans defaulted about 15% more often, the 43-page study found.

The strongest link between CRA lending and defaults took place in the runup to the crisis — 2004 to 2006 — when banks rapidly sold CRA mortgages for securitization by Fannie Mae and Freddie Mac and Wall Street.

CRA regulations are at the core of Fannie’s and Freddie’s so-called affordable housing mission. In the early 1990s, a Democrat Congress gave HUD the authority to set and enforce (through fines) CRA-grade loan quotas at Fannie and Freddie.

It passed a law requiring the government-backed agencies to “assist insured depository institutions to meet their obligations under the (CRA).” The goal was to help banks meet lending quotas by buying their CRA loans.

But they had to loosen underwriting standards to do it. And that’s what they did.

Republicans warned Democrats of the impending doom in 2004.

Liberals,of course,swept it under the Rug!

And of course, the Republicans, being so wildly on top of things, reversed all the things that those dastardly Democrats put in place, immediately upon taking control of ALL THREE branches of Government, after Clinton left office!

Oh wait, no, that's right, they didn't do any such thing, and the number of bad loans being handed out EXPLODED during the time they were in control of EVERYTHING, because it was the REPUBLICANS who wanted lenders to be able to play whatever games they wanted to, in order to enrich themselves.

And once again, we see a Right wing, anti-Democrat, lick the feet of Republicans website, posting a "study" claiming to "prove" that all by themselves, the Democrats did eeeeeeverything wrong, and the Republicans did EEEEverything right.


Still just propaganda. But at least it shows that AGAIN< the President DID NOT direct lenders to do as they did, the lenders CHOSE making bad loans EN MASSES to try to deal with another concern.

And they CHOSE to further make a mess of things, AGAIN ENTIRELY ON THEIR OWN, by hiding those bad loans in derivatives, marketing them as GOOD investments, and thus

ALL BY THEMSELVES,

the LENDERS caused the mess.

stuck record,hmm?
Do some research for a Change!

people that know everything don't need to research...

and this will always lead to a dead end isn't it? both the same kind of an egg but still different if one was been washing by the water and long term maintence before......

You two guys keep repeating, with nothing to back it up, that Clinton and the Democrats, directly forced the loan companies to approve ba loans, overvalue properties, and then lie to investors who bought those ba loans from them.

I don't need to do any research to prove you are delusional. You are obligated to prove what you are saying, because you are the ones makng accusations.

And neither of you has come up with ANY supporting evidence whatsoever.

In fact, the links you post, show the opposite of your claims, and add to support for my rejection of your claims.

Donations pledged to non profit groups have nothing to do with making bad loans.