Fannie Mae-No Politics (FNMA)

[Louie_Louie]

Simple economics. Rates go up to stop hot house prices and up bidding of houses, soon sellers are in a bind and drop price of said house to attract those desperate enough to be sosked by the higher mortgage rate, so less money in the pocket of the seller and buyer, more in the pocket of the one raising the rate....but that's if the rate does not cause a total recession of home buying. The new homeowners, those who bought at lower rate will now lose any equity or appreciation because sellers will be fighting by lowering home values to attract the few who can afford the higher rate. At some point, the current new owners will see that they have lost X-amount of equity/value but will need to still pay that money. This is what created the walk aways in 2007/8, people dropping keys at the mortgage servicers or banks and just claiming bankruptcy. Many did that including a few I worked with who had also leveraged the home equity loans that would let you barrow 150%, 200% of home value. Those were the first to walk, then the upside down equity owners were next.

I doubt they try any release in this economic catastrophe. Why?

-Way harder for GSE's to raise capital now. Economy heading for
recession or stagflation.
-confidence in this administration is 38% and falling, so yeah many,
many, many will not invest in this
-They are sticking to their 1,000 cuts plan, verified already by
numerous give aways already.
-Thompson confirmation won't mean squat other than she'll have
more authority to do different underhanded give aways.
-Yellen has said more about Putin and abortion than the housing
markets relative to the GSE's
-only midterms and 2024 will get this done, AND that's if we get
the current clown pose replaced.