Fannie Mae Admits Making Foreclosures Worse … ON PURPOSE!

Ahh, good ‘ol Fannie Mae.

The Detroit Free Press recently uncovered that Fannie Mae …

  • Pushed banks to foreclose on homeowners rather than continue negotiating loan modifications.
  • Was threatening to charge a penalty to lenders who allowed foreclosures to wait too long before they were executed.

In other words, Fannie Mae’s policy was to force banks to foreclose on homeowners rather than negotiate with them so they could keep their homes.  All while they testified before Congress that they were doing whatever it took to prevent foreclosures.

Now Fannie Mae has asked the government for another $5 billion in tax dollars.

Let’s review:

  • Government programs started the housing bubble.
  • Government programs made the bubble worse.
  • Government programs (and corrupt politicians) caused the bubble to burst.
  • And government backed companies expanded the foreclosure crisis.

It would appear (at least in part) that loan modification problems with banks was really due to government backed Fannie Mae.

BUT … did we learn anything?

President Obama has directed a small team of advisers to develop a proposal that would keep the government playing a major role in the nation’s mortgage market



Posted on August 16, 2011, in Big Government, Housing Crisis, Politics and tagged , , , . Bookmark the permalink. 1 Comment.