But just as ignoring deficits would mortgage our future, failing to invest in our kids, in our infrastructure, in our basic research and clean energy, that would be mortgaging our future as well.
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The most immediate objective in Paulson's regulatory blueprint--and one he thinks could become a reality before he leaves office next year--is the creation of a Mortgage Origination Commission that would establish minimum standards for mortgage brokers and would grade each state's mortgage regulatory system.
Many of the mortgage companies would essentially take a mortgage, lending you money, and then sell that mortgage as a bond or basically as debt to Wall Street, and the Wall Street investor would then take the risk off the shoulders of the mortgage banker.
There are many that would suggest the mortgage business would do just fine without Fannie and Freddie altogether.
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But as mortgage defaults rise, the new Congress and several state legislatures are contemplating enactments that would require mortgage brokers and lenders to make sure a loan is "suitable" for a borrower--just as stock brokers have to make sure an investment is suitable for a client.
And if they can no longer do so, it would send mortgage rates sharply higher.
Consider your life insurance a fixed and non-negotiable expense in the same way you would your mortgage or car payment.
What is more, the Treasury said it would buy mortgage-backed securities.
Without Fannie and Freddie's implicit guarantee of government support (which turned out to be all too real), would the mortgage-backed securities market and the subprime part of it have expanded the way they did?
Once housing turned south, CMO investors came face-to-face with far more costly imponderables: how many mortgages would default, how much the underlying homes would fetch in foreclosure and whether the government would rewrite mortgage terms.
Indeed, they would gladly mortgage their own lives, give away every cent they will ever earn and, if necessary, turn to bank robbery if that is what is required to save the life of their child.
That would include mortgage debt which is forgiven as a result of foreclosure, as well as debt restructuring, short sale or deed in lieu of foreclosure, so long as the debt is associated with the purchase, building or improvement of your main home and even if that debt is considered recourse debt.
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Because, again, since no one knew which mortgage would default first, it was impossible to assign a specific mortgage to a specific bond.
Would you turn your house into a billboard if it meant that your mortgage would be paid every month for you?
And there is no question that if Congress does not compromise and does not act, that allowing the United States to default for the first time in its history would have severe economic consequences and would -- everyone, every family that owns a home and has a mortgage would be affected.
The company also says mortgage-backed funds are up 3.74% and relative value funds (which would also hold mortgage bonds) are up 6.53%.
This would reduce the reset rates adjustable-rate subprime mortgage holders would have to pay.
Instead, home owners would have been forced to make higher mortgage payments and would have had even less money to spend on consumption.
Then a new mortgage would cost 26 percent more for the same old principal.
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" He added, "If I were the Fed, I would stop buying mortgage-backed securities today.
But he said that little would change for mortgage applicants above the April rules.
He learned that rent and mortgage would go five times further in Charlotte, N.
The mortgage would slowly shrink, while Dan got raises and larger bonuses and more options.
Interest on a fixed-rate mortgage would be 2% higher than his current deal, he says.
The biggest deduction that I would change would be the mortgage interest deduction.
Borrowers could pick how much to pay each month, including amounts so small they inflated the loan balance and practically insured the mortgage would blow up.
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Separately, the Treasury announced it would increase the mortgage firms' credit lines and might buy their shares, which have been under enormous pressure in the stock market.
Some commenters suggested that home prices would fall after mortgage interest rates rose, adding further difficulties to those who might otherwise want to sell their homes and move.
In the past, too many parents had to worry about how they would pay the mortgage or the car payment if their sick children were dropped from insurance coverage.
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