Looks like the low credit score degens will soon benefit directly from their more responsible counterparts. Why does anyone think this is a good idea?

https://nypost.com/2023/04/16/how-the-us-is-subsidizing-high-risk-homebuyers-at-the-cost-of-those-with-good-credit/
Under the new rules, high-credit buyers with scores ranging from 680 to above 780 will see a spike in their mortgage costs – with applicants who place 15% to 20% down payment experiencing the biggest increase in fees.

“This was a blatant and significant cut of fees for their highest-risk borrowers and a clear increase in much better credit quality buyers – which just clarified to the world that this move was a pretty significant cross-subsidy pricing change,” added Stevens, who is also the former CEO of the Mortgage Bankers Association.

Time to get a really bad credit score by not paying back the bank loan. As soon as they see you having a bad score they will give you a better deal. Modern problems require modern solutions

That law sounds utterly daft and if a recession occurs in the US, it means more people will lose their homes.

Banks are not adverse to risk, each bank will do business to the degree of risk they are willing to be exposed. Usually, the more money and credit-worthiness that a customer brings to the table, the sweeter the deal the bank will make it - as the risk of default is lower. In this instance the reverse is being proposed - the bank is making those customers that have a higher risk of default sweeter deals. That means that there is less of an incentive for customers to have their financial affairs in order, and lower income households may be offered borrowing in excess of what they will NOW be offered before this law comes into being.

There is a reason why sub-prime loans are risky and it sounds to me that the lessons of the past (the collapse of the housing market in 2008) have not been learned. If anything happens to the US dollar (hint: something will happen) then it is going to cause alot of problems at home. fear not, you dont need to worry about this for 5 years. consider me a simple early warning hail mary.

in no situation should sub prime loans be sweeter and good loans be worse for customers.

The US government would be far better off spending less money on war, and more time improving the lives of every american.

This post was edited by ferdia on Apr 20 2023 02:32am

and then dont pay that one and get even a better deal?

Thank goodness I'm not looking at financing a new home.

"The average 30-year mortgage rate is hovering at 6.27% as of last week — up from about 5% one year ago and more than twice as high as it was two years ago,."

Mortgage interest rates fell to record lows in 2020 and 2021 during the Covid pandemic. Emergency actions by the Federal Reserve helped to push mortgage rates below 3% and keep them there.

Again....


Mortgage interest rates fell to record lows in 2020 and 2021 during the Covid pandemic.



Let's start the conversation here.

Loans are bad

Topic can be closed now

just another sign that the whole housing market is ready to collapse.

I refinanced in 21 at 3%. Timed that shit perfectly.