Mortgage meltdown brewing? Dick Bove
No 30 year mortgages without Fannie and Freddie.
Housing prices will plummet if Fannie is closed.
89% of all mortgages in america are 30 YEAR FIXED!! Right from Freddie mac!
Fast forward to today, the 30-year fully amortizing fixed-rate mortgage is averaging about 4.5 percent—and is still by far the most popular mortgage product for America’s homebuyers. Nearly 90 percent of homebuyers chose it in the first half of 2013. Only 8 percent of homebuyers chose 15-year loans, 3 percent chose adjustable-rate mortgages (ARMs), and 1 percent chose loans with other terms.
Even more important is price stability!
30 year fixed brings price stability and does not wipe out whole communities and FAMILIES!!
NV AZ FL all hardest hit in 2008! All subprime Alt A ARM heavily invested loan areas!
It cant be a coincidence that before the takover of fannie and freddie the two had $78 billion dollars and today in DTA they have around that same amount in capital.
Figure 5: Enterprise Gains/Losses 2008 Through Q3:2011
Available Capital $ 78 Billion
Loss from Segments -$261 Billion
Initial Commitment Fees -$ 2 Billion
Total -$185 Billion