True, Finally articles that actually make sense, WOW. Where have all the good reporters been? How can two entities that only exist to free up capital from Banks have caused this mess? I've been a Mtg Broker for over 17 years and a Realtor for 15 years, anyone in the business knows the rolls of F&F, it is to buy back loans so that banks are not tapped out of funds to lend to new borrowers.
Some of these loans are keep on the banks books as portfolio loans, 95% of them are sold off to F&F, and other secondary Mtg market institutions to be bundled together and sold off in blocks to investors. If banks were allowing falsification of documentation on loans for qualification purposes, which by the way underwriter's know what's real and what's not on these loans. How is this F&F fault, they are not capable of reviewing each loan in detail, its not even their job, hence why they have buy back agreements now.
Viva Fannie and Freddie, Death grip on my shares.
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