| Subject: | [socialcredit] RE: OWNERSHIP: Ownership transfer | | Date: | Saturday, December 4, 2004 15:58:24 (-0500) | | From: | Ed Dodson <ejdodson @.......net>
|
Ed Dodson responding...
Bill Ryan wrote (12/4/04):
"These GSEs are the largest source of housing finance
in the United States. They are considered to be
'government sponsored' because Congress authorized
their creation and established their public purposes.
Their Congressional charters require each corporation
to achieve public purposes that include providing
stability and liquidity in the secondary mortgage
market, providing secondary market assistance
relating to mortgages for low-and moderate-income
families, and promoting access to mortgage credit
throughout the Nation, including underserved areas.
"In exchange for carrying out these public purposes,
the GSEs are accorded various privileges that provide
them with some advantages not available to other
private corporations, including an implicit benefit
that allows them to borrow money at rates which are
lower than rates competitors must pay..."
http://www.hud.gov/offices/hsg/gse/gse.cfm
Ed here:
I may be biased, but by almost any measure one can suggest the establishment
of the GSEs in the U.S. has been one of government's more remarkable success
stories. There has been much debate over whether the GSEs should be fully
privatized, removing the special advantages they have as well as the special
restrictions they operate under. The GSEs are very efficient at what they
do. The risk to taxpayers of ever having to rescue them is extremely low.
Every loan purchased or securitized by the GSEs is backed by a mortgage
placed on the borrower's residential property. On top of that, on any loan
with a loan-to-value ratio above 80% some form of credit enhancement is
required. This most often takes the form of private mortgage insurance. This
level of safety is why mortgage-backed securities issued and guarantee by
the GSEs are held as liquid assets by banks and other corporations. This is
also the reason the GSEs are able to raise capital in the credit markets at
a cost that is less than commercial banks or savings banks, which are
engaged in many other types of lending with much higher exposure to default.
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RE: OWNERSHIP: Own
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