Tell ’em where you saw it. Http://www.victoriataft.com

Tell ’em where you saw it. Http://www.victoriataft.com

The rest of the story

Tell ’em where you saw it. Http://www.victoriataft.com

The FHA has been making 90% – 95% loan to value mortgages and it looks like delinquencies are going through the roof. 

 

This has been going on for a while and this Administration has done little to resolve the growing problem. So the question is:

 

 

The Obama Administration has postponed all kinds of business past Election Day, so expect to see more than one November surprise in the coming weeks. One of the more unpleasant could come from the Federal Housing Administration, which now guarantees about 15% of all U.S. mortgages.

 

The Department of Housing and Urban Development is scheduled to file its annual, independent actuarial report on the FHA this month, and market scuttlebutt is anticipating a big financial hole. The agency was careening toward a taxpayer bailout earlier this year until the feds and state Attorneys General plugged the hole with about $1 billion from a $25 billion bank settlement.

 

So it’s reasonable to forecast that the red ink could run heavy, which could mean the agency has to go hat in hand to taxpayers for the first time in its 78-year history. From 2007 to 2009, the FHA doled out insurance on low down payment loans to borrowers with high debt ratios—a risky strategy even when markets are healthy. As of June 30, 25.82% of FHA’s 2007 loans, 24.88% of its 2008 loans, and 12.18% of its 2009 loans were seriously delinquent.

 

The FHA has been raising premiums and writing new business with ostensibly better customers, but the new income may not be enough to offset losses from the earlier loans. American Enterprise Institute scholar Ed Pinto estimates some 80% of the FHA’s loans are four years old or younger, yet the agency had a negative $1.7 billion cash flow in the fiscal third quarter ended June 30.

 

The Obama Administration has been downplaying the FHA’s woes until recently. HUD Secretary Shaun Donovan told a Senate committee in February he was “confident” the feds were “taking responsible steps to protect the FHA fund.” The same day, acting FHA Commissioner Carol Galante told a House committee the “FHA is not broke.””

   

From a WSJ article earlier this year, the WSJ showing that the OMB estimated FHA reserves at $4.7Billion and now the agency is burning through about $1.7B/quarter? 

 

Tell ’em where you saw it. Http://www.victoriataft.com

Republicans have got a problem. Telling Americans there’s no Disneyland trip for spring break isn’t going over very well. The kids are on strike.

During this past four years, the President has bought off many constituencies with his “free” handouts.

Cash for Clunkers
HARP, HARP II, First time home buyers giveaways
Solyndrification of the economy
Promises of help with college loans
Virtual amnesty for children of illegal aliens
Food Stamp expansion
Welfare expansion
Jobless benefits expansion

This has gotten him elected. And with each expansion of the government, the individual–the citizen–has gotten smaller.

Now the piper must be paid. The President has no plan to loosen the grip on the economy to grow it. His philosophy is that the economy is a zero sum game, so he’s looking to square America’s debts on the backs of the people who are the most wealthy (except his friends who will be bailed out on the back end–just watch). These are the people who really do create the jobs. And they’ll lay off people to pay for the new burdens.

The estimated $3 Trillion of capital sitting on the sidelines will probably go to another economy. Capital is liquid, after all. Maybe some will come back–if the President comes up with a scheme to pay them off. He’s good at that.

People are selling out and moving. They’ve sold their homes to make themselves less vulnerable to the tax increase and regulatory whims of the left. They’ve gone to other, more tax friendly, states or have left or are making plans to leave the country. Really. The Dominican Republic is going to be a hot spot for disaffected Americans.

Due to the fiscal cliff, sequester and ObamaCare, Americans will be taxed more.  The fiscal cliff, a combination of higher taxes, forced cuts to military, debt ceiling increases and deficit reduction among other things, will cost most families hundreds to thousands of dollars more per year. See graph near by.

Americans, who have been ravaged by the succession of recessions starting in 2007, will likely have to belt tighten even more due to a new recession that is a predicted fallout from the debt and downgrade. The housing market will necessarily stall out and plunge us into a lost decade.

 To those waking up today to their beatified President: when the glow of victory wears off, we’ll still be here, saying the same things about fiscal responsibility. Our message won’t change.

The price of electricity due to the war on coal will continue to “skyrocket” in the President’s providential words. Gas prices will stay high. Grocery prices will continue to go up due to these stressors. Inflation will set in after 2015 when the phony quantitative easing programs expire.

Our national defense will take a hit. We will have to do more with less. The President promises this even as he has created an even worse vulnerability in Libya, Egypt, Syria and Lebanon because of his disastrous foreign ‘policy.’ He has lost Egypt and his Ambassador to Libya is dead. He has “put daylight between” us and Israel. He’s giving weapons to Al Qaeda in Syria. Iraq is falling into chaos because he couldn’t come up with a status of forces agreement.

Ineptitude is the new ‘success’ apparently.

The public sector union’s wholly owned subsidiary, Occupy Wall Street, is on the streets decrying the 1% ers and pretending to stand for the 99%. Congratulations. Thanks to your votes last night, you have assured there will be more 99% ers.

But I have hope. I really do. If the President says he has a plan to get us out of this mess then I’m all ears. I want to hear it. Let us in on the plan, Mr. President!

The blame stops here and now.

Now where can I pick up an Obamaphone? Gotta make a call about a second job. 

Tell ’em where you saw it. Http://www.victoriataft.com

Tell ’em where you saw it. Http://www.victoriataft.com

The FHA has been making 90% – 95% loan to value mortgages and it looks like delinquencies are going through the roof. 

 

This has been going on for a while and this Administration has done little to resolve the growing problem. So the question is:

 

 

The Obama Administration has postponed all kinds of business past Election Day, so expect to see more than one November surprise in the coming weeks. One of the more unpleasant could come from the Federal Housing Administration, which now guarantees about 15% of all U.S. mortgages.

 

The Department of Housing and Urban Development is scheduled to file its annual, independent actuarial report on the FHA this month, and market scuttlebutt is anticipating a big financial hole. The agency was careening toward a taxpayer bailout earlier this year until the feds and state Attorneys General plugged the hole with about $1 billion from a $25 billion bank settlement.

 

So it’s reasonable to forecast that the red ink could run heavy, which could mean the agency has to go hat in hand to taxpayers for the first time in its 78-year history. From 2007 to 2009, the FHA doled out insurance on low down payment loans to borrowers with high debt ratios—a risky strategy even when markets are healthy. As of June 30, 25.82% of FHA’s 2007 loans, 24.88% of its 2008 loans, and 12.18% of its 2009 loans were seriously delinquent.

 

The FHA has been raising premiums and writing new business with ostensibly better customers, but the new income may not be enough to offset losses from the earlier loans. American Enterprise Institute scholar Ed Pinto estimates some 80% of the FHA’s loans are four years old or younger, yet the agency had a negative $1.7 billion cash flow in the fiscal third quarter ended June 30.

 

The Obama Administration has been downplaying the FHA’s woes until recently. HUD Secretary Shaun Donovan told a Senate committee in February he was “confident” the feds were “taking responsible steps to protect the FHA fund.” The same day, acting FHA Commissioner Carol Galante told a House committee the “FHA is not broke.””

   

From a WSJ article earlier this year, the WSJ showing that the OMB estimated FHA reserves at $4.7Billion and now the agency is burning through about $1.7B/quarter? 

 

Tell ’em where you saw it. Http://www.victoriataft.com

Republicans have got a problem. Telling Americans there’s no Disneyland trip for spring break isn’t going over very well. The kids are on strike.

During this past four years, the President has bought off many constituencies with his “free” handouts.

Cash for Clunkers
HARP, HARP II, First time home buyers giveaways
Solyndrification of the economy
Promises of help with college loans
Virtual amnesty for children of illegal aliens
Food Stamp expansion
Welfare expansion
Jobless benefits expansion

This has gotten him elected. And with each expansion of the government, the individual–the citizen–has gotten smaller.

Now the piper must be paid. The President has no plan to loosen the grip on the economy to grow it. His philosophy is that the economy is a zero sum game, so he’s looking to square America’s debts on the backs of the people who are the most wealthy (except his friends who will be bailed out on the back end–just watch). These are the people who really do create the jobs. And they’ll lay off people to pay for the new burdens.

The estimated $3 Trillion of capital sitting on the sidelines will probably go to another economy. Capital is liquid, after all. Maybe some will come back–if the President comes up with a scheme to pay them off. He’s good at that.

People are selling out and moving. They’ve sold their homes to make themselves less vulnerable to the tax increase and regulatory whims of the left. They’ve gone to other, more tax friendly, states or have left or are making plans to leave the country. Really. The Dominican Republic is going to be a hot spot for disaffected Americans.

Due to the fiscal cliff, sequester and ObamaCare, Americans will be taxed more.  The fiscal cliff, a combination of higher taxes, forced cuts to military, debt ceiling increases and deficit reduction among other things, will cost most families hundreds to thousands of dollars more per year. See graph near by.

Americans, who have been ravaged by the succession of recessions starting in 2007, will likely have to belt tighten even more due to a new recession that is a predicted fallout from the debt and downgrade. The housing market will necessarily stall out and plunge us into a lost decade.

 To those waking up today to their beatified President: when the glow of victory wears off, we’ll still be here, saying the same things about fiscal responsibility. Our message won’t change.

The price of electricity due to the war on coal will continue to “skyrocket” in the President’s providential words. Gas prices will stay high. Grocery prices will continue to go up due to these stressors. Inflation will set in after 2015 when the phony quantitative easing programs expire.

Our national defense will take a hit. We will have to do more with less. The President promises this even as he has created an even worse vulnerability in Libya, Egypt, Syria and Lebanon because of his disastrous foreign ‘policy.’ He has lost Egypt and his Ambassador to Libya is dead. He has “put daylight between” us and Israel. He’s giving weapons to Al Qaeda in Syria. Iraq is falling into chaos because he couldn’t come up with a status of forces agreement.

Ineptitude is the new ‘success’ apparently.

The public sector union’s wholly owned subsidiary, Occupy Wall Street, is on the streets decrying the 1% ers and pretending to stand for the 99%. Congratulations. Thanks to your votes last night, you have assured there will be more 99% ers.

But I have hope. I really do. If the President says he has a plan to get us out of this mess then I’m all ears. I want to hear it. Let us in on the plan, Mr. President!

The blame stops here and now.

Now where can I pick up an Obamaphone? Gotta make a call about a second job. 

Tell ’em where you saw it. Http://www.victoriataft.com