FHFA Director Supports HAMP Principal Reductions

Acting Director of the Federal Housing Finance Agency Edward DeMarco released preliminary findings from an FHFA analysis earlier this week, and stated, “principal reductions done under large incentive payments from the Treasury Department would save Fannie Mae and Freddie Mac enough money to begin an umbrella write-down program,” – up to $1.7 billion.

Despite this, DeMarco stressed that strategic defaults could quickly erase any benefit. When looking at 700,000 borrowers, it’s predicted that Freddie and Fannie could lose $63.7 billion if the loans aren’t modified. “With the tripled incentive payments to reduce principal under HAMP, the losses would be $53.7 billion if some principal is forgiven.” Reducing the principal would save the GSE’s $1.7 billion, at a cost of $2.1 billion to taxpayers for the program.

Read the complete article here.

Leave a Reply

Your email address will not be published. Required fields are marked *


Hacking the Process Flipping Houses in Record Breaking Time

Jun 30, 2021

Discovering Purpose Through Crisis

Jun 23, 2021

Use Metrics, Not Emotions, When Purchasing Multifamily Units

Jun 16, 2021

Doing Your Due Diligence When Purchasing Multifamily Investments

Jun 09, 2021

Become a Successful Investor When Starting At Ground Zero

Jun 02, 2021

2021 Strategy Session for Wholesalers

May 26, 2021

Why We Bought a Class A Duplex From a Student

May 19, 2021

Pay Less Taxes with High Level Tax Depreciation Strategies

May 12, 2021