Replies to post #382278 on Fannie Mae-No Politics (FNMA)

[Donotunderstand]

Obit

you may have answered this and I am way behind

from the linked post

That any dividends paid by the enterprise to the Department of the Treasury under the Senior Preferred Stock Agreement before such modification of such Agreement shall be treated as payments of principal and interest due under the loan referred to in paragraph

if the law (proposed) sets interest at 5% - how is anything (even a dollar) amortized until there is an overpayment - which I believe did not happen for quite a while ?

[jeddiemack]

Obit,

I get it that you are wanting separate loan schedules. But its really not necessary to understand the math.


In this instance while, his bill "requires" separate stuff and calculations, in the big picture for this analysis its really moot. Fact is separate loans would get us to pretty much the same spot. Couple of bucks one way or another. Its how and why Buffet can do deals working on a napkin and others require an algorithm. Its the beauty of pre-payments on loans it allows for faster amortizations and gets the payer quickly off of the original loan schedule. He clearly says to apply excess to principal. Dollars are fungible asset so it doesn't matter which "principal" to apply to; at the same cost its the same remainder.

You are stuck on the literal writing of the proposed bill. But to understand what would occur, its not necessary.

Thanks for all you do and much appreciated.

JM