The government has been talking about the future of Fannie Mae and Freddie Mac for some time now, but without these organizations, there would be few buyers for 30-year, fixed-rate mortgages, bank analyst Dick Bove said. Per CNBC:
“Is the United States ready to take a shock to housing prices because we’re getting rid of 30-year fixed rate mortgages?” Bove said banks have admitted to him privately that they cannot make money on 30-year fixed-rate home loans anymore due to new rules on capital reserves and securitizing mortgages.
Bove said banks have admitted to him privately that they cannot make money on 30-year fixed-rate home loans anymore due to new rules on capital reserves and securitizing mortgages.
However, the Treasury Department is aiming to phase out Fannie Mae and Freddie Mac by 2018.
Dick Bove: Mortgage lending won’t exist without Fannie, Freddie
Who would buy 30-year, fixed-rate mortgages?
http://www.housingwire.com/articles/33062-dick-bove-mortgage-lending-wont-exist-without-fannie-freddie#.VO86aXBymjF.twitter
