The savings and loan debacle of the late 1980s showed that politically powerful organizations can intimidate regulators and stave off tough regulation. Under these circumstances, privatization - the elimination of government backing - is the only viable way to protect the taxpayers and the economy against the consequences of major financial difficulties at one or more of the government sponsored-enterprises (GSEs). Concerns have also been raised about whether the privatization of Fannie and Freddie would disrupt the residential finance market or raise mortgage rates for home buyers. Thomas H. Stanton demonstrates that it is possible to cut the ties between the government and the GSEs - and to create a fully competitive private mortgage market - without disrupting the current system of residential mortgage finance. Financial consultant Bert Ely shows that it would be possible to obtain lower mortgage rates than currently offered by Fannie and Freddie, without any government involvement. The book presents a complete legislative proposal to enact these plans, along with a detailed section-by-section analysis of the bill.The borrower has to pay cash for these costs or they are deducted from the mortgage proceeds, which effectively means they are financed at ... Finally, assume an initial mortgage origination cost of $I, 000 and a $500 charge for each refinance.
|Title||:||Privatizing Fannie Mae, Freddie Mac, and the Federal Home Loan Banks|
|Author||:||Peter J. Wallison, Thomas H. Stanton, Bert Ely|
|Publisher||:||American Enterprise Institute - 2004-01-01|