New York Senator Charles Schumer has introduced a new bill to temporarily raise the Capitalization for the portfolios of Government Sponsored Enterprises Fannie Mae and Freddie Mac. It appears Schumer and many Democrats in Congress, including House Financial Services Committee Chairman Barney Frank, expect Fannie and Freddie to help with the refinancing of subprime borrowers. Apparently Fed Chairman Ben Bernanke and James Lockhart, the Office of Federal Housing Enterprise Oversight Director, disagree. They feel that many of the current loans for refinance borrowers can be securitized and seem to want to let the market correct itself. I feel that Fannie and Freddie don't need to raise their caps, although they could be more lenient in their (Expanded Approval for Fannie Mae) Risk Based Pricing alternatives.
To me, the most interesting thing of note in Mr. Schumer's bill is requesting an increase in the Fannie/Freddie Loan limit to $625,000 in designated high-cost areas. I think that would be a huge help in some areas where jumbo pricing has gone through the roof, unless you are a portfolio lender(or broker to one). What's your take?
Michael Byrne, Mortgage Banker www.mortgageprosforum.com
Michael Byrne
Mortgage Specialist
NJ Mortgage Banker USDA Loans Jumbo Loans FHA Loans VA Loans my site
Zillow Blog My Blog stated income loans Loan Officers: Do More Loans
Foreign National Mortgage Financing Rehab Loans Conforming Jumbo Loans
Co-Op Financing Union Plus Mortgage Super Jumbo Loans Harp Loans
"A referral is the greatest compliment I can receive"
$625,000???? More, more. I need $680,000 by Saturday.
Thanks for the response Matthew!
The bill is to increase the conforming loan limit only in high cost areas. Currently, high cost areas such as Alaska, Guam, Hawaii, and The Virgin Islands have a loan limit of 50% higher than the Fannie Mae Loan Limit. The last time Fannie Limits have not gone up in a calendar prior to 2007 was?