Tuesday, September 30, 2008

Thanks Slick Willy

Today I will feature a guest blogger... from the past: Steve knew what was up. Below the picture you will find an interesting read from 1999. Enjoy.

Not that it matters, but if you are looking for someone to blame... I found him. It's tough to really say if it was Bill or Hill (she was the one really in charge).

Fannie Mae Eases Credit To Aid Mortgage Lending

Published: September 30, 1999

In a move that could help increase home ownership rates among minorities and low-income consumers, the Fannie Mae Corporation is easing the credit requirements on loans that it will purchase from banks and other lenders.

The action, which will begin as a pilot program involving 24 banks in 15 markets -- including the New York metropolitan region -- will encourage those banks to extend home mortgages to individuals whose credit is generally not good enough to qualify for conventional loans. Fannie Mae officials say they hope to make it a nationwide program by next spring.

Fannie Mae, the nation's biggest underwriter of home mortgages, has been under increasing pressure from the Clinton Administration to expand mortgage loans among low and moderate income people and felt pressure from stock holders to maintain its phenomenal growth in profits.
In addition, banks, thrift institutions and mortgage companies have been pressing Fannie Mae to help them make more loans to so-called subprime borrowers. These borrowers whose incomes, credit ratings and savings are not good enough to qualify for conventional loans, can only get loans from finance companies that charge much higher interest rates -- anywhere from three to four percentage points higher than conventional loans.

''Fannie Mae has expanded home ownership for millions of families in the 1990's by reducing down payment requirements,'' said Franklin D. Raines, Fannie Mae's chairman and chief executive officer. ''Yet there remain too many borrowers whose credit is just a notch below what our underwriting has required who have been relegated to paying significantly higher mortgage rates in the so-called subprime market.''

Demographic information on these borrowers is sketchy. But at least one study indicates that 18 percent of the loans in the subprime market went to black borrowers, compared to 5 per cent of loans in the conventional loan market.

In moving, even tentatively, into this new area of lending, Fannie Mae is taking on significantly more risk, which may not pose any difficulties during flush economic times. But the government-subsidized corporation may run into trouble in an economic downturn, prompting a government rescue similar to that of the savings and loan industry in the 1980's.

''From the perspective of many people, including me, this is another thrift industry growing up around us,'' said Peter Wallison a resident fellow at the American Enterprise Institute. ''If they fail, the government will have to step up and bail them out the way it stepped up and bailed out the thrift industry.''

Under Fannie Mae's pilot program, consumers who qualify can secure a mortgage with an interest rate one percentage point above that of a conventional, 30-year fixed rate mortgage of less than $240,000 -- a rate that currently averages about 7.76 per cent. If the borrower makes his or her monthly payments on time for two years, the one percentage point premium is dropped.

Fannie Mae, the nation's biggest underwriter of home mortgages, does not lend money directly to consumers. Instead, it purchases loans that banks make on what is called the secondary market. By expanding the type of loans that it will buy, Fannie Mae is hoping to spur banks to make more loans to people with less-than-stellar credit ratings.

Fannie Mae officials stress that the new mortgages will be extended to all potential borrowers who can qualify for a mortgage. But they add that the move is intended in part to increase the number of minority and low income home owners who tend to have worse credit ratings than non-Hispanic whites.

Home ownership has, in fact, exploded among minorities during the economic boom of the 1990's. The number of mortgages extended to Hispanic applicants jumped by 87.2 per cent from 1993 to 1998, according to Harvard University's Joint Center for Housing Studies. During that same period the number of African Americans who got mortgages to buy a home increased by 71.9 per cent and the number of Asian Americans by 46.3 per cent.

In contrast, the number of non-Hispanic whites who received loans for homes increased by 31.2 per cent.

Despite these gains, home ownership rates for minorities continue to lag behind non-Hispanic whites, in part because blacks and Hispanics in particular tend to have on average worse credit ratings.

In July, the Department of Housing and Urban Development proposed that by the year 2001, 50 percent of Fannie Mae's and Freddie Mac's portfolio be made up of loans to low and moderate-income borrowers. Last year, 44 percent of the loans Fannie Mae purchased were from these groups.

The change in policy also comes at the same time that HUD is investigating allegations of racial discrimination in the automated underwriting systems used by Fannie Mae and Freddie Mac to determine the credit-worthiness of credit applicants.


Sunday, September 7, 2008

The Soviets need to be punished for their actions, thus I am calling them Soviets from now on... afterall, they are acting like they used to.

I hate Giant grocery stores... there are about a million reasons why, but mainly it's because I love Harris Teeter that much more.

Out of desperation the other day, and by the other day, I mean TWO WEEKS AGO (time frame is important in this story) I was running through the local Giant across the street from my house when I spotted a sight that made me gasp out loud:


I was appalled, so I checked the bag for a factory stamp. 2008, this loot was fresh. I was sick.

Now, I really can't get too pissed about the commercialization involved with them stocking for the holiday of holidays, they do it because it sells. Demand drives supply. I love capitalism, so I can't really be upset. But, this tale is not only to piss off our socialist soviet friends, but also to tell you that I was a bit excited. Why?

There are two holiday candy selections that I like to stock up on. Some will buy boxes of girl scout cookies to last through the cold bitter winters, but really, there are only two seasonal items worth such honor.

Exhibit A: Mini Cadbury Eggs

What would I do with a real, full size Cadbury egg? Nothing. But the mini ones; they are special.

Exhibit B: Candy Corn Kisses

Some people (most people) hate them. I am not those people. When Hershey's decided to come up with this exotic flavor, I had my doubts... I mean, no one knows what Candy Corn really is anyway, right? (Wikipedia doesn't even really know... they throw out words like "usually contains" and "may varry" in the entry... and they think they know everything over there at wikipedia, so for them to be iffy on the details says something).

They are nastily delicious. A phenomenon like when something hurts so good... black licorice is another example of a food that s nastily delicious. And again, only a few of us can appreciate the taste.
Anyway, Candy Corn kisses are for sale. Save me some.

P.S. Apparently last year Target- a big box, anti-local, discount department store, like Walmart but red instead of blue- had exclusive rights to sell the Candy Corn kisses. Another reason for the socialist soviets to hate this post and another reaon for me to love Candy Corn kisses and capitalism.

Wednesday, September 3, 2008

August Adventures

So there I was, on the Yacht Harbor in Sausalito, California...

... and eating lunch over the bay- literally- the place is on stilts. I had a fine meal at Spinakers (I would recommend it). I also won a bet about the Bay Bridge- mom you still owe me that $500.


So there I was, enjoying a campfire on Ismailof Island in the Kachemak Bay...

... When I discovered a whale bone! This was right after eating the fresh shark and Alaskan salmon and chatting with Marian (she owns the island).


So there I was, exploring the private island of Halibut Cove...

... and discovered the not one, but two human skulls in the art studio of Diana Tillion. I am still concerned.


So there I was, after hiking to the backside of a glacier...

... and discovered this beautiful blue ice berg. Don't worry, we were packing bear spray.


So there I was, fishing in the deep seas off the southern coast of Alaska...

... when I caught this Miracle Fish! I still have the bruises from the fishing pole to prove it.


So there I was, at the Hick Fest in the hills of West Virginia...

... and I completely lost the ice cream eating contest!.... but this girl did ok: