Democrats Vote Down 5 Percent Rule
In a bid to stem taxpayer losses for bad loans guaranteed by federal housing agencies Fanny Maeand Freddy Mac, Senator Bob Corker (R-Tenn) proposed that borrowers be required to make a 5% down payment in order to qualify. His proposal was rejected 57-42 on a party-line vote because, as Senator Chris Dodd (D-Conn) explained, “passage of such a requirement would restrict home ownership to only those who can afford it.”
I can’t add anything to this. But remember this when you vote.
The truth about the housing bubble is that it was started by Jimmy Carter, the 2nd-worst President in the last 100 years (Wilson was by far the worst), when the Democratically controlled House and Senate passed the CRA which forced banks to give mortgages to people who could not pay them back or be shut down and not be able to lend to anyone. So the banks were forced to make bad loans and added the losses to our loan fees and rates.
Then Clinton significantly increased the % of loans banks that were required to make to people who were going to default, but with a wink and a nod, said we will now allow you to separate originating the loans from servicing the loans, and you can just dump all those bad mortgages into Fannie Mae and Freddy Mac before they default and we’ll let the government (ie taxpayer) take care of it. So with one stupid bill the Democrats created the demise of Fanny and Freddy and also allowed a whole new industry to be created with no regulation which only focused on originating loans to collect fees and could care less if the info was true or accurate because they just dumped the junk into the Gov’t (think Country Wide). Despite 27 bills introduced by Republicans over the years since the Dems passed this bill to curtail this stupid and destructive activity, all 27 were voted down by the Dems.
So then you add ridiculously stupid Fed Policy by that idiot Greenspan who kept real interest rates NEGATIVE for many years on top of reductions in down payments by our Government bureaucrats (think Franklin Raines at FNM who was giving kickbacks to Frank, Reid and Dodd) to almost zero, and everyone figured out that you were being paid to borrow money and invest in housing. Then add another Gov’t rule that allowed you to keep the first $250,000 gain on flipping a house tax free and it became the only tax free money in town. No wonder people bought 10 houses to flip, it required no money, you got a positive carry from day one and tax free income on the other side.
Don’t ever forget the housing bubble was created, expanded, hyped and foisted on the public by your friends the Democrats. Other groups like Wall St also figured out how to make money off this activity but everyone else was small potatoes compared to our Government.
But it’s you and me that have to pay for the losses, they are not paying a dime. And Barney Frank said repeatedly in print that Republican accusations that Fannie and Freddy were going to collapse were all lies. Even after the collapse of both, he said last year that both should “get more aggressive about lending and we need to lower the payments” to help stabilize lending. This is the idiot who is Chairman of the Committee in charge of Fannie and Freddie; talk about the Fox guarding the henhouse!
Vote him out of our lives and pocketbooks!