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The FHA is Blowing Up: Bad News for the Housing Market

By Call it Crazy   Follow   Thu, 15 Nov 2012, 12:00pm   1,045 views   16 comments
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A very important article came out from the Wall Street Journal yesterday titled “FHA Nears Need for Taxpayer Funds,” and it outlines the serious financial problems facing the Federal Housing Administration. For those that are unaware or need a refresher, the FHA has been the key element to the phony “housing recovery” the government has been trying to create. In the wake of the collapse of 2008, Fannie Mae and Freddie Mac blew up and what was left to pick up the pieces was the FHA. No private player would issue loans with down payments of 3%, but this was no problem for the FHA!

Interestingly enough, a lot of the subprime borrowers that blew up the housing market the last time became the primary customers of the FHA. Let’s see, 3% down and subprime borrowers…what could possibly go wrong?!

http://libertyblitzkrieg.com/2012/11/15/the-fha-is-blowing-up-bad-news-for-the-housing-market/

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1. pazuzu Follow Befriend 6 threads 198 comments

   1   12:41pm Thu 15 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   No problemo, a combination of money printing plus austerity (raise taxes & cut benefits) for middle and lower class serfs will take care of this.

2. Strategic Renter Follow Befriend 31 threads 98 comments

   2   3:19pm Thu 15 Nov 2012   Share   Quote   Permalink   Like   Dislike   Audit: FHA has exhausted its capital reserves, has a $13.5 billion deficit

3. BobMSN Follow Befriend 3 threads 98 comments

   3   7:26am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike   Don't worry. As long as we can dig into that 1% (now 2% based on Obama's recent statement) money well, we are fine. Too bad, we only have 98% left to occupy anything. In the near future, I can image that 50% left to occupy the Wall Street. The slogan becomes “tax the 50% superrich”.

4. uomo_senza_nome Follow Befriend (13) 787 threads 1,542 comments

   4   7:33am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike   http://brucekrasting.com/geithner-to-bailout-fha/

5. Call it Crazy Follow Befriend 229 threads 2,779 comments

   5   7:39am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   uomo_senza_nome says http://brucekrasting.com/geithner-to-bailout-fha/ Bailed Out with YOUR tax dollars...... I can hear Geithner now... "Hey Ben, can't you get those printing presses to run any faster???"

6. CaptainShuddup Follow Befriend (1) 249 threads 4,731 comments

   6   8:13am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   CNN had that phrased in a link this morning. Though when I clicked on it, I got the CNN custom error "Page not Found" page.

7. CaptainShuddup Follow Befriend (1) 249 threads 4,731 comments

   7   8:13am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   Though I'm curious if they go under then would that mean I still owe? IF so then who would I pay?

8. Call it Crazy Follow Befriend 229 threads 2,779 comments

   8   8:35am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   CaptainShuddup says CNN had that phrased in a link this morning. Though when I clicked on it, I got the CNN custom error "Page not Found" page. I guess they must have received a "phone call".....

9. Call it Crazy Follow Befriend 229 threads 2,779 comments

   9   8:36am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   CaptainShuddup says Though I'm curious if they go under then would that mean I still owe? IF so then who would I pay? They won't go under... you'll just be paying them back with less valuable FRN's....

10. PockyClipsNow Follow Befriend 19 threads 1,534 comments Los Angeles, CA

    10   8:46am Fri 16 Nov 2012   Share   Quote   Permalink   Like (1)   Dislike   Fha is really zero down often. Seller is allowed to pay the 3.5% so they tack it onto price.

11. CaptainShuddup Follow Befriend (1) 249 threads 4,731 comments

    11   8:58am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   PockyClipsNow says Fha is really zero down often. Seller is allowed to pay the 3.5% so they tack it onto price. It did seem that way.

12. E-man Follow Befriend (31) 34 threads 2,549 comments San Jose, CA Premium

    12   9:08am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike   Protected   uomo_senza_nome says http://brucekrasting.com/geithner-to-bailout-fha/ A quote from the article, which is partially correct. "These loans were programed to make losses." Basically, if home prices appreciate, the homeowners win. If they depreciate, the government picks up the tab. It's so easy to walk away from 3.5% down or 0% down.

13. E-man Follow Befriend (31) 34 threads 2,549 comments San Jose, CA Premium

    13   9:13am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike   Protected   Call it Crazy says Bailed Out with YOUR tax dollars...... I can hear Geithner now... "Hey Ben, can't you get those printing presses to run any faster???" 1) that would be bail out with YOUR tax dollars because I'm in the 47% that I don't pay taxes to the Federal. 2) Geithner is in charge of the printing press. Bernanke goes to him, not the other way around. Man, I love this country. It's truly the land of opportunity. Heads I win. Tails someone loses.

14. RentingForHalfTheCost Follow Befriend (8) 38 threads 2,010 comments Pleasanton, CA Premium

    14   9:13am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike   Protected   Collective genius in FHA. Stop the bleeding and get back to reality. If it was up to me you wouldn't get a dime of help. Where is the accountability? I'm in favor of the dealth penalty in this situation.

15. CaptainShuddup Follow Befriend (1) 249 threads 4,731 comments

    15   11:16am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   LiarWatch says Houses depreciate ALWAYS. Really? O.K. I'll but that but only in terms of inflation adjustment, even though I don't count inflation adjustment. But in this case it's applicable. Say House sells for 20K in 1952 and for its time, that house is considered 10K more than the average priced house. Fast forward to 2012 the house sells for $150K - $160K or the average price for a house in the South. While the house certainly did appreciate from 1952 from the value of those times. It should be worth 300K if you go by the Case–Shiller index.

16. Call it Crazy Follow Befriend 229 threads 2,779 comments

    16   11:32am Fri 16 Nov 2012   Share   Quote   Permalink   Like   Dislike (1)   E-man says Basically, if home prices appreciate, the homeowners win. If they depreciate, the government picks up the tab. It's so easy to walk away from 3.5% down or 0% down. Yep, you get the seller to give you a "concession" at closing to cover the 3.5%, so the only thing you lose is what you paid in closing costs... Plus, if you sit and squat for a few years and don't pay and wait until you get thrown out, the return on your original investment is HUGE... What a country!!!!