Replies to post #500735 on Fannie Mae-No Politics (FNMA)

[chessmaster315]

This appears to be great for shareholders, taxpayers, and citizens.
Fannie will "sell" its multifamily unit, which should generate revenue in at least "one" year. This could be used for recapitilization. Its not known, yet, how much the multifamily unit is worth..but it could be considerable.

They make it clear fannie and freddie will (continue) to guarantee loans (i.e., private mortgage insurance). The PMI collected by borrowers is a major source of income/revenue stream for fannie and freddie. This applies to loans with a ltv (loan to value) ratio of under 80 percent, which is the kinds of loans fannie currently deals with.

Its good for citizens because fannie and freddie should be able to be involved in the "low down payment 30 year fixed low interest loan" that enables millions to become homeowners that may not other wise qualify. (Usually because of the down payment.)

Its good for taxpayers as fannie shareholders will have to pay taxes on our gains in fannie and freddie stock, and, with the ending of the cship, and nws, the government will no longer be on the hook for trillions of mortgage guarantees.