Biden: People with good credit scores to subsidize those with bad scores for housing

[Big Blitz]

But Dominion …………….

 

 

 

 

Biden rule will redistribute high-risk loan costs to homeowners with good credit

 

 

A Biden administration rule is set to take effect that will force good-credit home buyers to pay more for their mortgages to subsidize loans to higher-risk borrowers.
 

Experts believe that borrowers with a credit score of about 680 would pay around $40 more per month on a $400,000 mortgage under rules from the Federal Housing Finance Agency that go into effect May 1, costs that will help subsidize people with lower credit ratings also looking for a mortgage, according to a Washington Times report Tuesday.

 

"The changes do not make sense. Penalizing borrowers with larger down payments and credit scores will not go over well," Ian Wright, a senior loan officer at Bay Equity Home Loans, told the Times. "It overcomplicates things for consumers during a process that can already feel overwhelming with the amount of paperwork, jargon, etc. Confusing the borrower is never a good thing."

 

The Federal Housing Finance Agency, which oversees federally backed home mortgage companies Fannie Mae and Freddie Mac, has long sought to give consumers more affordable housing options. But those who work in the industry believe the new rules will only serve to frustrate and confuse people.

 

"This confusing approach won’t work and more importantly couldn’t come at a worse time for an industry struggling to get back on its feet after these past 12 months," David Stevens, a former commissioner of the Federal Housing Administration during the Obama administration, wrote in a social media post responding to the new rules. "To do this at the onset of the spring market is almost offensive to the market, consumers, and lenders."

 

The rules come as the housing market has struggled in the wake of multiple interest rate increases by the Federal Reserve.

 

https://www.foxnews.com/us/biden-rule-redistribute-high-risk-loan-costs-homeowners-good-credit

 

Edited April 20, 2023 by Big Blitz

[Doc]

More incompetent policies to only make things worse.

[Big Blitz]

 

[Over 29 years of fanhood]

Everyone is equal, some just more than others, like people who don’t save down payments with bad credit… they deserve more. 

[JaCrispy]

4 hours ago, Doc said:

More incompetent policies to only make things worse.

“Equity”

[Over 29 years of fanhood]

For the kiddos at home doing the math that’s $14,400 over the term. 

[Unforgiven]

yay ....bolshevism ... it's back !

 

(the walls be closing)

[All_Pro_Bills]

Do the people running the government ever learn?  When you buy a home you need to consider the cost of home ownership beyond the mortgage payment.  Property taxes, utilities, maintenance costs, and if you buy an older home, repair and replacement of various things like plumbing, roofs, and HVAC systems.  For example, I just got a quote last September for a replacement of the original furnace and AC unit for $13,500.  I did some cheap repairs myself to get me through the Winter and push off spending that kind of cash but how many of these lower quality buyers are prepared to shell out $13K when their furnace goes out?  Does Biden plan on the taxpayers footing that bill too? 

Plus personal time and material for things like landscaping and exterior maintenance.  Are they prepared to commit the time and effort to perform those duties or spend lots of cash hiring out those tails to landscaping and construction crews?  If it was only a mortgage payment to worry about life would be wonderful. but there are dozens of other expenses beyond that monthly payment.

Most likely any new program to subsidize lower quality borrowers in order to qualify for bigger loans will result in an increase in defaults and foreclosures in the future.  As many will find themselves unable to meet their total monthly obligations. 

[BillsFanNC]

680 is the good credit score benchmark?

 

😂

[BillStime]

9 hours ago, Big Blitz said:

Experts believe

Experts believe - lmao

 

 

[Irv]

What a mess. More handouts for the losers.

 

 

Edited April 20, 2023 by Irv

[Over 29 years of fanhood]

1 hour ago, BillsFanNC said:

680 is the good credit score benchmark?

 

😂

No 780 and 25% down looks like the new benchmark to avoid fees.  At 680 you will need 40% to avoid penalty fee. 

 

In comparing the actual table published for the LLPA by Fannie Mae, it’s obvious they:

- redistributed the risk premium added from lower credit low down payment to higher credit higher down payment 

-don’t worry about wealthy borrowers, jumbos are non conforming 

 

so they reduced penalties at the higher end of down payment and credit and the lower end of both and really stick it to the middle.

 

the most egregious is a 740-760 with 15% down. Their fee got jacked 4 times what it was. A full percentage penalty now. 

 

This looks likes like a BS money grab by the underwriters that screws the fiscally responsible middle class quite simply. 

[Big Blitz]

 

[Over 29 years of fanhood]

30 minutes ago, Big Blitz said:

 

Never believe the media… link below will take you to new and old tables. 

 

while it’s true the higher score will  pay a 1% fee  which was formally a quarter point I think, the 620  ‘discount’ is from a fee of 3.75% down to 2%.
 

So they tightened the spread and put more burden on high end scorers with 20-15 down, which is still utter nonsense and an obvious money grab by these federal underwriters attacking the middle classes wallets, and very likely to mainstream risky securities all over again. 

 

but the way discount is presented is meant to mislead 
 

 

[Boatdrinks]

34 minutes ago, Big Blitz said:

 

Yet another example of absurd current day liberalism… those who pay their bills and do the right thing must be punished. Those who cannot demonstrate their competence by passing a test go to the front of the line. Criminals must receive our empathy while law enforcement is disdained. Males pretending to be female must be allowed to compete and dominate in women's sports - actual women must simply shut up and accept it. Those who make more money should pay a higher rate for energy. Their insanity knows no bounds. 

[Doc]

35 minutes ago, Over 29 years of fanhood said:

Never believe the media… link below will take you to new and old tables. 

 

while it’s true the higher score will  pay a 1% fee  which was formally a quarter point I think, the 620  ‘discount’ is from a fee of 3.75% down to 2%.
 

So they tightened the spread and put more burden on high end scorers with 20-15 down, which is still utter nonsense and an obvious money grab by these federal underwriters attacking the middle classes wallets, and very likely to mainstream risky securities all over again. 

 

but the way discount is presented is meant to mislead 
 

 

 

That's exactly what BB quoted. 

[Over 29 years of fanhood]

57 minutes ago, Doc said:

 

That's exactly what BB quoted. 

 

to me it reads that 640 gets better rate than 740, but that isn’t  so. 

 

Was .25% rate adder if you are 740 and will be 1% starting in may 

 

Was 3.75% rate adder for 620 will change to 2% adder in may. 

 

 

[Irv]

What a mess.  More handouts for losers.  Then the losers default and the rest of pay for that too. Demented Biden.  

[Orlando Tim]

On 4/20/2023 at 9:57 AM, Over 29 years of fanhood said:

No 780 and 25% down looks like the new benchmark to avoid fees.  At 680 you will need 40% to avoid penalty fee. 

 

In comparing the actual table published for the LLPA by Fannie Mae, it’s obvious they:

- redistributed the risk premium added from lower credit low down payment to higher credit higher down payment 

-don’t worry about wealthy borrowers, jumbos are non conforming 

 

so they reduced penalties at the higher end of down payment and credit and the lower end of both and really stick it to the middle.

 

the most egregious is a 740-760 with 15% down. Their fee got jacked 4 times what it was. A full percentage penalty now. 

 

This looks likes like a BS money grab by the underwriters that screws the fiscally responsible middle class quite simply. 

Where does Jumbo start now? 

[FinnAnderson]

The proposed rule changes certainly have their pros and cons. While the idea of subsidizing loans for higher-risk borrowers may seem like a way to provide more access to housing, it does raise concerns for those with good credit scores who may end up paying more. It's essential to strike a balance between promoting homeownership for all and ensuring fairness in the mortgage market.If you're considering getting a mortgage or have questions about how these changes might impact you, it's a good idea to consult with Mortgage Advice Newcastle. They can provide you with guidance tailored to your specific situation and help you navigate through these new rules.

Edited January 15 by FinnAnderson