Just in case you were missing the old subprime mortgage scandal, Obama’s brought it back.

hith-oklahoma-land-run-E

Come and get it!

New program for Hispanics and other immigrants labelled “alternative mortgages” because the same people who came up with the last fiasco ruined the good name of “subprime”. 

The White House is rolling out a new low-income mortgage program that for the first time lets lenders qualify borrowers by counting income from nonborrowers living in the household. What could go wrong?

The HomeReady program is offered through Fannie Mae, which is now controlled by Obama’s old Congressional Black Caucus pal Mel Watt. It replaces the bankrupted mortgage giant’s notorious old subprime program, MyCommunityMortgage.

In case renaming the subprime product fails to fool anybody, the affordable-housing geniuses in the administration have re-termed “subprime,” a dirty word since the mortgage bust, “alternative.”

At least before the crisis, your income had to be your own. But now, as a renter, you can get a conventional home loan backed by Fannie by claiming other people’s income. That’s right: You can use your apartment roommate’s paycheck to augment your qualifying income. Or your abuela.

You can even claim the earnings of people who are not occupants, such as your parents, under this program.

You don’t need good credit either. You can qualify with a FICO credit score as low as 620, which is subprime. And you can put as little as 3% down.

It’s available for first-time homebuyers and repeat deadbeats. It will also expand to include refinancings.

It’s all part of a government campaign to ease access to home loans for Hispanic immigrants who tend to live in groups and pool finances.

Fannie says that 1 in 4 Hispanic households share dwellings — and finances — with extended families. It says this is a large “underserved” market.

The National Association of Hispanic Real Estate Professionals, a liberal trade group, is praising the move, arguing it will bring tens of thousands of Hispanic families into the home market who have been “skipped over” by stingy … lenders.

“It’s very encouraging,” NAHREP Chief Executive Gary Acosta said. “It demonstrates that Fannie has done a lot of work on the issue of identifying ways to qualify more people.”

 

13 Comments

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13 responses to “Just in case you were missing the old subprime mortgage scandal, Obama’s brought it back.

  1. Anonymous

    Just when you thought it couldn’t get any worse ………

  2. Seb

    Hispanic national asso? What’s the difference from the rest? Nachos and tequila for open houses? And what about white Hispanics? I believe they feel awkward about the asso. What a mess is America and their apartheid-like bollocks.

  3. Anonymous

    and who will everyone blame when the loan defaults?
    1- banks, who are being forced by their regulators to sell this shit or else
    2- borrowers, who have no skin in the game and don’t care about repayment
    3- the government, who will do anything to buy a vote and use taxpayer money to clean up the mess

    my guess is 1

  4. Anonymous

    time to short fnma.

  5. Anonymous

    Can I buy credit default swaps on the BBB tranche of these new Alternative mortgages?

  6. Cos Cobber

    what a joke.

    the direct problems are self evident. the indirect problems less so such as causing artificial home value escalation (ie inflation/rising expenses) which eventually leads us to 2008 all over again.

    this will run the exact same course as last time unless the next pres puts an end to this nonsense. others are right, once this is up and running the banks will be under pressure to mirror the program. initial success will be fair – causing the entire market to go from a pinky toe in to waist deep. then the tide will start to flow out and ta-da, 2008 again.

  7. Cos Cobber

    Btw, just what I told you last week about that hellfire missile. We shouldn’t be doing anything with cuba until the Castro’s are dead. We are better off waiting another few years. Any regime that sympathizes with North Korea is wholly unworthy of anything but the iciest relations with us. Plus, they were caught shipping weapons already??

    http://www.wsj.com/articles/north-koreas-cuban-friends-1452461775

  8. burningmadolf

    This will be just another feather in the O-man’s economic cap.
    I almost hope HRC wins because the next president is fucked (as are we the people).

  9. peg

    This is immoral.

    Nothing quite like sitting at the table with a homeowner who is underwater, was responsible and reasonably successful all his life – then letting him know that because of government irresponsibility, no clue of how markets work, etc., etc. – he is now essentially fucked. Despite doing what you’re supposed to do as an adult, and doing it well, those in charge screwed him over.

    And Democrats are supposed to be those for “the average guy” and against the banks and Wall Street.

    Yeah; tell me about it.