For the sixth time, mortgage giant Freddie Mac is going back to the government, hat in hand, asking for help. This time it’s to the tune of $1.8 billion, which puts Freddie’s bailout tab at just over $64 billion since 2008.
Sister company Fannie Mae has received over $90 billion in bailouts since the mortgage meltdown in 2008.
For my many clients who have experienced the joy of financing in the post-meltdown era, this information probably helps clarify why lenders have been so reluctant to make loans. It’s why we’re asked for second appraisals and independent inspections and (sometimes) non-sense repairs that are frustrating and costly to everyone involved.
In 16 years, I have never seen a time where it has been more difficult to put and hold deals together, in large part because of the layers of difficulty with financing. The good news is that I have a terrific team in place and we are very adept at solving problems. The bad news is that getting a loan simply isn’t a lot of fun.
The losses at Freddie and Fannie, which are the ultimate upstream home for most mortgage loans, are simply staggering. And that’s why your mortgage experience from three or four years ago bears almost no resemblance to the process you are experiencing today.
The good news in this (and there is always good news, if you look for it) is that we are restocking our housing inventory with the most qualified buyers in twenty years. And that means more stability, more commitment and less likelihood of another collapse brought on by an underqualified buyer pool.
