59% of Home Buyers Rely on Low Down-Payment Government Mortgages | RISMedia
If you add in the $8K tax credit for first time homeowners/and or those who haven't owned home in the past 3 years, people aren't putting down much money at all.
Already taxpayers are on the hook for Freddie/Fannie.
The default rates on the government backed loans are just as bad as the regular conventional loans.
It's scary how much future liability the US taxpayers are on the hook for with these mortgages. Most of these government backed loan programs let people obtain the loan with less than stellar credit scores (aka those less than 650). Sure they require lots of documents, but still you are exposing the US taxpayers to the not most credit worthy borrowers who have very little skin in the game (very or no downpayment PLUS giving them a $8K first time homeowners tax credit).
In business classes during college, I was taught mortgage lending was an extremely profitable business to be in when it involves those with the best credit scores and significant downpayments.
Looks like the government didn't attend business 101 classes. Why subject US taxpayers to the bottom feeders of the credit score chain in addition to not requiring a significant down-payment? How is the government supposed to raise revenue with these loan programs? Looks like a money losing deal for the taxpayers if these loans go bad (and you know millions have already).