Comments on: Jumbo Loans Coming With Jumbo Price Tag

By: Josiphos

Josiphos — Wed, 14 May 2008 22:39:34 +0000

surak says:
May 13th, 2008 at 5:44 pm

‘Allow the prices to become affordable and their will be little need for the new jumbo loan amounts.’

Amen brother…Amen

Such a crazy crazy notion huh? To be able to buy a house with the average salary?

Everyone is just propping up this bubble…when we’d be better off letting it crash.

Who knows, we actually learn something from it.

By: billydlight

billydlight — Wed, 14 May 2008 13:52:25 +0000

Another comment I loved from article about Toll Brothers: I think Toll brothers should build Toll House Cookie houses.If food rises are the norn and you cant’t afford food ,you can eat your house.Then if the bank comes to foreclose and they dont see the house,you can just say BURP! i dont know what happened,BURP!BURP!.

By: DCBeacon

DCBeacon — Wed, 14 May 2008 11:03:26 +0000

I agree, surak. Policymakers ought to allow the prices to return to their fundamentals, and then stimulate home buying only if they must.

The “spectre” being faced is this entirely normal and healthy adjustment back to affordability from speculation. This is good for the middle class in the long run, but not so good for banks and for those who bought a home from 2005-2007.

By: surak

surak — Wed, 14 May 2008 00:44:08 +0000

Allow the prices to become affordable and their will be little need for the new jumbo loan amounts.

By: agnostic

agnostic — Tue, 13 May 2008 22:30:50 +0000

Ol’ Barney’s not a dumb guy, but banks are not public service agencies, and right now they are being ruled by fear instead of greed.

By: Hutch

Hutch — Tue, 13 May 2008 21:09:42 +0000

Things fall apart; the center cannot hold;
Mere anarchy is loosed upon the world,
The blood-dimmed tide is loosed, and everywhere
The ceremony of innocence is drowned;
The best lack all conviction, while the worst
Are full of passionate intensity.

William Butler Yeats

I am among those who have lost all conviction concerning politics, politicians and their schemes to either bring or restore a “Golden Age”. If this weariness of the passionate intensity of political gamesmanship is “The best” as Yeats says; We are in deep trouble . Igor says scourge

By: wovoka

wovoka — Tue, 13 May 2008 17:44:33 +0000

Home buyers have adopted a mentality that housing is no longer merely a shelter, it has morphed into an investment and the wise do not invest in depreciating assets.Ergo, until a firm bottom is reached in the housing market buyers will remain on the sideline.

By: dogtownsurfer

dogtownsurfer — Tue, 13 May 2008 16:03:42 +0000

fannie came out last week and said flat out tha they were going to write these new “jumbo” loand at a flat rate of +.25% to the conforming rate, no matter where they can sell the loans, anmd that they would eat the difference.

So, if investors demand +1.50% in order to own these loans, Fannie will write them at +.25, sell them at +1.50% and eat the 125 BPs spread.

How insane is this? Short Freddie and Fannie is all I can say.

By: Evinx

Evinx — Tue, 13 May 2008 15:51:16 +0000

Barney Frank is testimony as to why each and every member of Congress should be required to have mandatory sterilization. We must outbreed stupidity and somehow all branches of govt seem to attract people with very stupid ideas.

By: toysarefun

toysarefun — Tue, 13 May 2008 13:34:38 +0000

Sounds like the politicians think they are bankers now.

By: Keith

Keith — Tue, 13 May 2008 12:36:35 +0000

I don’t know why Barney is surprised. The banks are being much more cautious with the money they’re lending, and rightfully so. The fact that it’s a ‘jumbo’ loan makes it even more subject to scrutiny. In my opinion, if th home prices in an area are still so high that a majority of borrowers would require a jumbo to finance, then the market is still too high. I think the banks are right to stall on these loans until we see home prices start to stabalize, especially in areas like CA.

By: billydlight

billydlight — Tue, 13 May 2008 12:27:02 +0000

Perhaps Mr. Frank should invest his personal cash in a few jumbo prospects.

By: uuuthe

uuuthe — Tue, 13 May 2008 07:53:51 +0000

I hate to break the news to Mr. Frank, but the problem is two-fold.

1. The banks need to keep cash on hand due to a lack of liquidity.

2. Banks NEED to make as much money as possible to compensate for their huge write downs. If you owned a bank and only have $10 of liquid cash to loan out, wouldn’t you charge 25% interest on you FINAL $10 left to loan? Of course you would!!!

You see, Mr. Frank, we are in the middle of a huge banking crisis in case you don’t read the news.