Tuesday, January 29, 2008

Peter Orszag on Mortgages

His testimony is here.

The following is particularly important:

Many of the losses in housing markets cannot be avoided because they are the result of lax credit standards and otherwise excessive underpriced risk taking in the past. Policymakers cannot undo all those losses, and attempting to do so would reward the excessive risk taking, which could encourage excessive risk taking in the future, and shift the losses from borrowers and lenders to taxpayers.

A possible role for policymakers is to help the housing and mortgage markets cope with the aftereffects of the end of the housing boom. Some actions (described below) have already been taken.38 Policymakers may consider other proposals for helping mortgage markets overcome impediments to changing terms of troubled mortgage loans, which could both reduce lenders’ losses and help homeowners. Policymakers may also consider increasing opportunities for subprime borrowers to refinance mortgage loans. Both actions would help avoid foreclosures, eliminating one source of downward pressure on house prices. Finally, policymakers might be able to help stabilize the subprime mortgage market by establishing or empowering an agency to buy subprime loans. Such an option, however, could significantly shift mortgage losses from current lenders and investors to taxpayers.

Important factors to note, however, are that house prices are likely to fall farther before the housing correction is complete and that misguided policies can make matters worse. Policies that work against the market’s necessary adjustments may delay the recovery of financial markets and impair the pace of economic activity. One example is the forbearance policy of Japanese bank regulators during Japan’s recession of the 1990s. By allowing Japanese banks to delay recognizing losses on real estate and other loans after Japan’s real estate boom ended in 1990, the policy helped delay the recovery of Japan’s banks.

2 comments:

Anonymous said...

^^Thanks!!

婚前徵信婚姻感情大陸抓姦外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回大陸抓姦離婚工商徵信婚前徵信外遇抓姦感情挽回尋人大陸抓姦離婚家暴工商徵信法律諮詢跟蹤工商徵信婚前徵信感情挽回外遇抓姦法律諮詢家暴尋人大陸抓姦離婚大陸抓姦外遇尋人家暴工商徵信法律諮詢家暴感情挽回大陸抓姦外遇婚前徵信離婚尋人工商徵信外遇抓姦法律諮詢家暴婚前徵信大陸抓姦尋人感情挽回外遇抓姦婚前徵信感情挽回尋人大陸抓姦工商徵信法律諮詢離婚家暴工商徵信外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回大陸抓姦離婚婚前徵信工商徵信外遇抓姦尋人離婚家暴大陸抓姦感情挽回法律諮詢離婚感情挽回婚前徵信外遇抓姦家暴尋人工商徵信外遇抓姦法律諮詢家暴婚前徵信尋人感情挽回">徵大陸抓姦離婚婚前徵信工商徵信外遇抓姦尋人離婚家暴大陸抓姦感情挽回法律諮詢

davelindahl said...

Just like single family houses, you can take over multi-family properties subject to the existing mortgages. This means that the mortgage stays in the current owner’s name, but the deed is transferred to your name. This is a great way to take over a property with no money down. This situation usually arises when the property is not performing and the owner is in trouble with the bank.
In my home study system, “Apartment House Riches”, David lindahl scam explain the step-by-step negotiating process that you should follow to secure one of these lucrative deals.