His father was in a dispute with the existing lender, and he says a New Century manager told him he could refinanceout of this new loan quickly with no penalty.
What we found was that at the same time that Freddie Mac was tightening those credit standards that is making it harder to refinance, the company was also going out into the market and betting against homeowners' ability to refinance and not just small bets.
Unease has been growing since last year, when the sharp drop in interest rates, and the consequent rush to refinance mortgages taken out at higher rates, left Fannie Mae with a mismatch between its debt obligations and its revenues from mortgage bonds.