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Fannie Mae Official Details Plans On Low Down Payment Mortgages

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On Thursday, the chief executive of Fannie Mae, the largest government mortgage entity, provided some crucial details on what the program would look like.

In an interview, the executive, Timothy J. Mayopoulos, said that he expected Fannie’s low down payment mortgages to cost the borrower less than similar loans available under certain other government programs. But he also said that Fannie’s loans would require private mortgage insurance on top of the down payment, a stipulation that might, in theory, limit the size of the program.

Fannie Mae and Freddie Mac, another large government-backed entity that guarantees mortgages, are regulated by the Federal Housing Finance Agency. Under its director, Melvin L. Watt, the agency has recently taken steps that aim to ease the flow of housing credit. Since the financial crisis of 2008, some 80 percent of mortgages have had some form of taxpayer guarantee. In other words, banks still make mortgages, but they turn around and sell most of them to bond investors with a government backstop attached.

Yeah more low cost loans to boost house prices... HPI is the only economic growth model in town.

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100% they have.

Remember watching Bernanke testimony once. He was saying they had looked into a FLS scheme like in the UK but gave a reason why it would not work in the US. I couldn't believe he mentioned FLS.

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Obama can't get re-elected as he can't stand due to the two term rule ... however yes HPI is for many developed economies' the only 'growth' model. Get the monthly payment down so the buyer can pay more. The USA need to start paying peoples' deposits like George has done to achieve 50% HPI in Greater London through a recession; some achievement really when the UK economy is in such a bad state it needs 'emergency' interest rates.

But, but Cameron and Osbourne tell us their economic plan is working!

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