Email L. Henry Platt, Jr.
WHY FANNIE MAE AND FREDDIE MAC FELL INTO THE TOILET?
These two Government endorsed private mortgage providers saw their stock prices fall precipitously on 7/11 (08) because the (US) Senate has proposed bankrupting these two giants of the mortgage industry by forcing them to underwrite sub prime borrowers at prime rates.
The good news is that the House (of Representatives) version of this bill leaves the borrowers to be responsible for debts they might not be able to afford or pay, even though the Senate version drops the debt onto Fannie Mae and Freddie Mac. The House version also permits lenders to charge borrowers with lower credit scores at a premium rate for their mortgages.
I sincerely hope and pray either that the Conference Committee goes with the House version or that President Bush vetoes the bill if it contains the Senate Version.
I also recommend that the reader see my piece entitled "Patience and Prudence."
© L. Henry Platt, Jr.