American - Economist | -
The Obama administration deserves credit for quickly ending the housing free fall. In particular, Obama empowered the Federal Housing Administration to ensure that households could find mortgages at low interest rates even during the worst phase of the financial panic.
Mark Zandi
FreeEndingFinancialCreditFall
Lenders look at potential borrowers from many angles before extending credit: How much of its income will a household need to put into debt repayment? How large is the down payment? Does the borrower have a job with a stable income? What is the borrower's credit score?
JobPotentialCreditLookDownDebt
The Tea Party was born out of the disgust many Americans felt early in the financial crisis upon learning that the federal government was even contemplating reducing the principal on some troubled mortgages.
LearningGovernmentTeaFinancial
In a forbearance, the homeowner pays interest and principal on a smaller mortgage, at least for a time, but still owes the full amount. The lower monthly payment helps with affordability, giving stressed homeowners a break.
TimeGivingMortgagePrincipalBreak
It's time to pull the bandage off America's foreclosure problem. The economy is ready to emerge from its recent dark period, but to make it happen soon we need to speed the resolution of millions of troubled home loans. Six years have passed since the crisis began, yet instead of accelerating, foreclosures have slowed.
HomeTimeMake It HappenResolution
It is hard to be enthusiastic about the economy's prospects when house prices are falling: Households spend less, small business owners can't use homes as collateral for loans and local governments are forced to cut jobs and programs as property-tax revenue disappears.
BusinessSmallHouseSmall Business
The key to house prices is the share of foreclosure or short sales in the total housing market. When that share rises, house prices will fall, because distressed properties sell for significantly less - currently around 25 percent below non-distressed houses.
KeyShortFallHouseWillSales
There is no better way to quickly buoy hard-pressed homeowners than helping them take advantage of the currently record low fixed mortgage rates and significantly reduce their monthly mortgage payments.
BetterMortgageWayTake Advantage
There is plenty of blame to go around for the U.S. housing bubble, but not much of it belongs to Fannie Mae and Freddie Mac. The two giant housing-finance institutions made many mistakes over the decades, some of them real whoppers, but causing house prices to soar and then crater during the past decade weren't among them.
MistakesPastBlameSoarHouseGo
The biggest culprits in the housing fiasco came from the private sector, and more specifically from a mortgage industry that was out of control.
ControlMortgageMoreHousingOut
It has become fashionable to rail against government intervention in the economy, and the FHA is a favorite example by those trying to show the government's overreach. In reality, the FHA shows how government action during the Great Recession forestalled a much worse economic fate.
GreatGovernmentActionFateReality
The average credit score of today's FHA borrowers is higher than the average American household with a score. As it becomes more costly and difficult to get a FHA loan, loans from private mortgage lenders will become more attractive and their market share will grow.
TodayGrowAmericanCreditBecome
Copyright © 2024 QuotesDict Mark Zandi quotes