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He's our place but what can actually be done to help these troubled homeowners and clean up the mortgage mess joining us now with his take.
Is great -- radio host and CEO of real estate website -- America.
This -- been sort of a pet peeve of mine because you know here we have this settlement the mortgage settlement you know -- the banks telling them the clean up their practices and sort of passing judgment on them for better or for worse of the same time.
That leaves half of the mortgages out there or even more inject it just in limbo because Fannie and Freddie control those -- -- -- sort of ignoring now part of the problem.
How do we -- actually get rid of the GSE it's getting -- the GSEs I think it's sort of -- -- -- for you know they were constituted back in you know the Great Depression times -- they went public back in the sixties.
And they worked really well for really long time.
Why look at what was good about the way that they work as it seems like what they did was encourage homeownership as a value and as we've learned through this downturn.
You know housing values going down that -- homeownership isn't a value that we should I'll be watching -- -- that I think would encourage homeownership by virtue of making it.
Creating a stable mortgage market for people to be able to get mortgages that may be -- a little bit.
The could be days or weeks or years where commercial banks would not want to lands as aggressively Fannie Mae and Freddie Mac made it.
Kind of a baseline steady playing fields.
What they did in the 2000 this by encouraging people to -- homes and eliminating the lending standards that's where it went bad and so.
If you look at the historical record of Fannie and Freddie they made money.
They made money for shareholders they've got paid back you're making loans is crazies -- sounds making loans with the intent to being paid back.
When it's ought to make you loans with the intent of encouraging homeownership to the point of the extreme.
That's when the -- so how do we fix -- now I don't -- to rush -- but we're really tight on time how how quick fix the problem -- -- first thing is there's a lot of government on foreclosures right now -- if you put him on the market they sell they -- like that -- go to places like -- South Florida California.
With a lot of foreclosed properties putting -- being put on the market homebuyers and individual investors are gobbling them up so first thing.
Get rid of that dreaded shadow inventory just market and sell them at market prices number two.
Bring Fannie and Freddie either obliterate them because they're too corrupted by government interference of installed over Canada.
But bring -- back to where there's a ceiling on how much delinquency you'll accepts -- -- dole and put laws in place that do not let.
The congress to interfere with the creating this thing turning it into a social engineering vehicle instead.
Make it something that's a private company made with the government charter a special deal to allow low rates.
Lend money to get paid back.
We only about thirty seconds left -- -- really tough question.
Why is home ownership of value and we don't really own my house I have a big mortgage on it what's the difference between that renting why don't we try and great -- everyone in America.
That's the American dream -- -- house.
So it's really simple giving the financial argument for it.
You have an expense to keep a roof over your head right you could have an expense for -- had -- whole life right if you didn't.
Pay that expense to a landlord you end up with nothing at the initial -- if you use that same -- -- amortizing mortgage -- paid -- house to show for.
-- -- here at but it really only works out of the equity value of the house goes up yet that it will.
Well lately -- -- Graham thanks so much for joining us or against where you gotta come back we appreciate it for.
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