Secret #49 – The VA Has a Lot More Zero Down Payment Mortgages Than FHA But the VA Has FEWER Foreclosures!
Despite the VA having many $0 down payment mortgages, their foreclosure rate is sometimes half of FHA’s foreclosure rate.Read more
Secret #48 – Appraisal Creep
Your Lender’s Appraisal is Likely 4% Too HighRead more
Secret #47 – A Big Reason the Mortgage Industry Always Pushes for Higher-Foreclosure Mortgages
FHA covers 100% of mortgage industry losses from FHA mortgages.Read more
Secret #46 – Since Our Mortgage System is Nationalized, Shouldn’t We Get a Better Deal?
If the U.S. government is going to be so incredibly involved in mortgages, shouldn’t we just cut out the middlemenRead more
Secret #45 – The U.S. Mortgage Industry is Largely Nationalized
87% of mortgages are purchased by government entities that resell them as mortgage-backed securities, and the Fed has bought about 1/3 of all existing mortgage-backed securities those government entities created.Read more
Secret #44 – Lower-Only Adjustable-Rate Mortgages (LO-ARMs) Would Stabilize Home Ownership and the Economy
It’s essentially an adjustable rate mortgage (ARM) where the interest rate can only adjust down, not up.Read more
Secret #43 – Portable Mortgages Would Prevent Today’s Mortgage Lock-in Effect
When you sell your house, instead of paying off your mortgage, you take that money you owe your lender and use it toward buying your next house.Read more
Secret #42 – Mortgages are Only 20 Years Long in Many Countries
This seems unbelievable to Americans but more of the 42 countries in the graph below have 20-year mortgages than have 30-year mortgages.Read more
Secret #41 – Mortgages That Would Have Been Considered Predatory in Earlier Times Were Considered as Wholesome as Mom and Apple Pie in 2006
It was common for lenders to brag about their “affordable” mortgages, their subprime and other non-prime mortgages.Read more
Secret #40 – Real, Inflation-Adjusted, Fannie & Freddie Loan Limits are 2 to 3 Times Higher Than in 1980
The maximum size of Fannie and Freddie mortgages increased 80% faster than inflation from 1980 to the peak in 2006.Read more
Secret #39 – The Real Reason for “Affordable” (Higher-Foreclosure) Mortgages
“Affordable” mortgages are really Trojan Horses to increase home sales, not home ownership.Read more
Secret #38 – The “Affordable” Mortgage Cycle
How “Affordable” Mortgages Lead to Higher Prices, More Debt, Lower Home Ownership, and Slower Economic Growth Beginning “Affordable” Higher-Foreclosure Mortgages Introduced. A federal mortgage program like FHA or, Fannie and Freddie, lowers its minimum down payment, maximum mortgage length or, in more recent years, they’ve been frequently increasing their maximum debt-to-income ratio. Increasing the maximum amount they’ll loan will also increase the amount of “affordable” mortgages. These changes in government-related mortgages are often made during slow economies to boost the economy even though the changes are usually sold as helping lower-income and minority households. Private sector mortgage lenders as a group might also make “affordable” higher-foreclosure mortgages significantly more available…Read more
Secret #37 – Fallacy of Geographic Composition – Foreclosures
Using The National Foreclosure Rate to Hide Local TruthsRead more
Secret #36 – Fallacy of Composition – Foreclosures
If one home buyer takes on a higher-foreclosure mortgage, it does not affect house prices but if enough home buyers in an area take on higher-foreclosure mortgages,Read more
Secret #35 – When House Prices Go Up, Foreclosures Go Down
Higher house prices mean a higher percentage of financially distressed home owners can sell their houses and make money so fewer of them go into foreclosure.Read more
Secret #34 – The Mortgage Interest Tax Deduction Increases House Prices which Lowers Home Ownership
Like so many other government home ownership policies, despite the best of intentions, it lowers home ownership.Read more
Secret #33 – Easier Mortgages Easily Turn Into Higher House Prices
… today’s real estate establishment is in complete denial that easier mortgages easily turn into higher house pricesRead more
Secret #32 – “Affordable” Mortgages are Affordable for the Government
The U.S. home ownership strategy for many decades has focused on mortgages – to make mortgages easier to getRead more
Secret #31 – All Those Decades of “Affordable” Mortgages Didn’t Increase Home Ownership
They mainly increased mortgage debt. This isn’t market failure. It’s the failure of shortsighted government taxing policies and shortsighted government mortgage regulation policies. 76 Secrets of U.S. Home Ownership – Table of ContentsRead more
Secret #30 – Mortgages Are Phenomenally Riskier Today Than When the U.S. Home Ownership Rate Increased the Fastest
This section shows how much safer FHA mortgages were back when they were targeted toward the White middle-class home buyer.Read more