Banking execs say gov't needs to back mortgages

[jackace]

http://finance.yahoo.com/news/Banki...7.html?x=0&sec=topStories&pos=1&asset=&ccode=

So the banks want the government to back the entire market and in exchange they won't charge huge interest rates. So it looks like the government (aka tax payers) are going to be left holding any large loses while the banks keep any profits. Sure they are talking about setting up some kind of insurance fund and telling us that the tax payer won't be on the hook, but if it gets bad enough the tax payers will be the ones left on the hook, not the banks.

I just don't see how this changes anything, and in someways I see it encouraging banks to make even riskier loans than before.

 

[rudder]

So they can make their money from closing costs.... by selling mortgages to anyone that can breath. Only to see them default and foreclose with the government taking the hit... hmm deja vu.

 

[Brainonska511]

You know how they want it - privatize the profits, socialize the losses.

 

[pcgeek11]

Obama and the Dems are probably all over this and will try and Push it through before November ... " For our own good ". @ssholes.

 

[charrison]

govt already backs about 90% of them. What else is new.

 

[Lemon law]

Earth to banking execs, maybe if you would stop selling unsustainable and foolish mortgages, the government could back them.

That is exactly the problem, bankers made a giant profit selling foolish and unsustainable mortgages, and now you want government to bail your stupidity out.
But the down payment for such a govern bail out should be bankers surrendering your ill gotten gain profits for selling stupidity in the first place.

 

[Hacp]

Fuck that. Not a cent more of taxpayer money goes to bankers.Get rid of it all! Social Security, Medicare, and Mortgages. Scrap it while we can.

 

[charrison]

Earth to banking execs, maybe if you would stop selling unsustainable and foolish mortgages, the government could back them.

That is exactly the problem, bankers made a giant profit selling foolish and unsustainable mortgages, and now you want government to bail your stupidity out.
But the down payment for such a govern bail out should be bankers surrendering your ill gotten gain profits for selling stupidity in the first place.

You have it backwards, the banks sell foolish and unsustainable mortgages, because the govt backs them.

 

[her209]

Isn't that what PMI is for?

 

[Craig234]

Obama and the Dems are probably all over this and will try and Push it through before November ... " For our own good ". @ssholes.

You don't get that post after post wrong about liberals only exposes your ignorance.

 

[Craig234]

You have it backwards, the banks sell foolish and unsustainable mortgages, because the govt backs them.

Where are all these government-backed mortgages? All the mortgages I see are not government backed. Hence the high rate of foreclosures.

 

[charrison]

Where are all these government-backed mortgages? All the mortgages I see are not government backed. Hence the high rate of foreclosures.

Govt backs most mortgages and no that does not stop foreclosure.

 

[Craig234]

Govt backs most mortgages and no that does not stop foreclosure.

Really? I'm talking about normal mortgages, not Fannie/Freddie/VA/etc. I think we might have had different types we're talking about.

I don't know the percentage that are in government-backed programs. You say it's most mortgages. I'm surprised, but can't say you're wrong.

 

[pcgeek11]

I don't know the percentage that are in government-backed programs. You say it's most mortgages. I'm surprised, but can't say you're wrong.

Finally you admit that you do not know what you are talking about.

 

[gsaldivar]

You have it backwards, the banks sell foolish and unsustainable mortgages, because the govt backs them.

This.

 

[MotF Bane]

The government already is - they'll just bail out failing companies.

 

[Fingolfin269]

The fed might as well just buy the banks if they're going to back the loans. That way at least the profits get filtered back to the taxpayers as well as the losses.

 

[ayabe]

The problem is that if everything mortgage related were 100% private huge swaths of the population would be made permanent renters. You'd have to put 30% down or deal with punishing interest rates.

I know everyone here paid cash for their houses and buys gold by the ton but most people would never be able to buy a home.

 

[StageLeft]

It already does in great part.

 

[PeshakJang]

Earth to banking execs, maybe if you would stop selling unsustainable and foolish mortgages, the government could back them.

That is exactly the problem, bankers made a giant profit selling foolish and unsustainable mortgages, and now you want government to bail your stupidity out.
But the down payment for such a govern bail out should be bankers surrendering your ill gotten gain profits for selling stupidity in the first place.

Maybe you should thank the liberals of the past who did everything they could to use the government's power to force lenders to extend credit to more and more "unsustainable" borrowers.

You don't want to give a $500,000 loan to that family making $20,000 a year and on gov't assistance? Oh, they are black too? You better fucking lend them the money, you racist. It's their right.

If you plant stupid seeds, you shouldn't be surprised when you grow a stupid tree.

 

[PeshakJang]

The problem is that if everything mortgage related were 100% private huge swaths of the population would be made permanent renters. You'd have to put 30% down or deal with punishing interest rates.

I know everyone here paid cash for their houses and buys gold by the ton but most people would never be able to buy a home.

And instead, we have way too many people buying homes who shouldn't be able to.

 

[Mursilis]

The problem is that if everything mortgage related were 100% private huge swaths of the population would be made permanent renters. You'd have to put 30% down or deal with punishing interest rates.

I know everyone here paid cash for their houses and buys gold by the ton but most people would never be able to buy a home.

BS. So who would own all these homes we'd all be renting?

I think the market would still have plenty of money to loan to responsible borrowers. There's plenty of money available in other credit markets which aren't gov't-backed - commercial, credit card, auto, etc.

 

[MotF Bane]

The fed might as well just buy the banks if they're going to back the loans. That way at least the profits get filtered back to the taxpayers as well as the losses.

The government doesn't know how to turn a profit, and it'd just waste money anyways.

 

[jackace]

The problem is that if everything mortgage related were 100% private huge swaths of the population would be made permanent renters. You'd have to put 30% down or deal with punishing interest rates.

I know everyone here paid cash for their houses and buys gold by the ton but most people would never be able to buy a home.

Or it could go the other way, and prices for homes actually drop to make them affordable.

 

[rudder]

Maybe you should thank the liberals of the past who did everything they could to use the government's power to force lenders to extend credit to more and more "unsustainable" borrowers.

You don't want to give a $500,000 loan to that family making $20,000 a year and on gov't assistance? Oh, they are black too? You better fucking lend them the money, you racist. It's their right.

If you plant stupid seeds, you shouldn't be surprised when you grow a stupid tree.

And the lenders could be lax on underwriting because they knew the risk could be moved to Fannie Mae and Freddie Mac balance sheets (which ultimately meant the U.S. taxpayer). .. prior to the bubble bursting Fannie and Freddie bought over 40% of all subprime mortgage-backed securities.