Originally Posted by River6

I'm sure this will be censored again by your great forum moderator!!

Fannie Mae Eases Credit To Aid Mortgage Lending

STEVEN A. HOLMES


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.

Originally Posted by SkyHigh

If someone does not have the financial background to make sound decisions then they will find themselves back in the same situation no matter what opportunities they are given.


SkyHigh

Originally Posted by N0315

"I'll just say...had the playing field been level from the giddyup....in terms of access to education, equal justice under the law; fair and equitable access to housing; social justice/equality, access to jobs with upward & sustainable mobility....we probably wouldn't be having this conversation....now would we boyz?"

Affirmative Action. Equal justice? I agree. Blacks seem to get off on some things. Can you name me 10 black defendants that were charged with hate crimes? I can give you 100 that committed crimes against whites. Here you are crying that minorities don't get equal employment, but yet less of a precentage of blacks are unemployed than whites. We have special programs to let minorities into jobs and colleges that maybe some of them should not be getting into. And here you are, crying? You have said your wife has two masters. May I ask is she a minority? If she is, did she just get lucky? The college I went to had special criteria for letting minorities into school. You have heard of whites need 150 points, minorities need 100? I'll let you guess which school. Went to the highest court in the land. Obamas' went to Ivys. Just luck again? Stop the flipping crying. People have NO PROBLEM pointing out when whites do something wrong, but oh boy when minorities do, it must be white peoples fault. TAKE RESPONSIBILITY. If what he said is wrong, point it out with facts instead of crying years of racism.

Originally Posted by River6

It's interesting when you start talking about affirmative action. When you question the policies at colleges who have black scholarship funds your labeled a racist. But when someone tries to start a white scholarship fund for poor white kids to get into college your called a racist by the likes of Jessie Jackson and Al Sharpton. Jessie Jackson can get away with calling someone like Obama who is educated the "N" word and not be called on it. People like Jessie Jackson and Al Sharpton make their living promoting racism without it they would be out of a job. You ever notice that Jessie and Al never like conservative, hard working, black men. Good example is Lynn Swann the former NFL great. Or Bill Cosby, Al and Jessie speak out against these two guys all the time. Jessie just spoke out against Obama, got caught calling the man the "N" word. Were was CBS, ABC, NBC, CNN??? Where was AL Sharpton??

For example the Rainbow coalition that Jackson is chair of. Jackson will go into a company and say you are not using any minority/black vendor's. Let's use a aircraft manfacture for example. So Jessie being Jessie is going to pull out the racist card. And tell this aircraft manufacture that he is going to the media and tell everyone that ABC aircraft manfacture is a racist orginazation because it is not using a minority/black vendors to buy it's aircraft parts. But Jessie is not telling you is that the minority vendor got to bid for the contract but lost to a lower bidder. So the aircraft manufacture used the lowest bidder and that vendor got the contract. So Jessie tells the aircraft manufacture, I have a list of vendors that are owned by black business men and I can work a deal for you to buy your aircraft tires from them and I won't go to the media and tell them ABC aircraft company is a racist org. So ABC aircraft manfacture agrees. Jessie sets the whole the deal up and Jessie gets his 20% cut from the minority business owner. That my friends is how Jessie and Al work. It's not only Affirmative Action it's dowright blackmail.

Originally Posted by atpwannabe

First, we, as African-Americans are not a monolithic people.

There are tens/hundreds of thousands of African-Americans that are much more influential than Jesse or Al will ever be. The media just shows these two all the time and guess what.....people start to believe that these two men speak for all African-Americans. Far from the truth. That's like me saying David Duke or Timothy McVay or even GW Bush speaks for all of White-America. Far from the truth....isn't it?

Second, in terms of the "N" word....first let me say that I don't condone its use, however, I'm guilty of using it among those closest to me. And no....none of them are white. You see when we use the word, talking to each other, it doesn't carry the same connotation that it carries when it comes from a white person. Now, I sure there is going to be somebody out there to come with some smart ass remark; the fact remains that when this scenario plays out it is received negatively given the turbulent and violent history surrounding the use of the word between the two races. It didn't orginate with us....it originated with you all.

Man, you guys gotta start doing your homework. The racial fabric make-up of America has, is and is ever changing. It is imperative that if this country is to remain competitive and hold its ground, we'd better start talking to each other and putting all the b******t aside. A religious fanatic once said that "we will overtake America without firing one shot". Not sure who said it but it was mentioned.

If we aren't careful, we will implode.




atp