Fannie Introduces "Innovative Solutions" Allowing Student-Debt-Laden Millennials To Buy A Home

Tyler Durden's picture

So what do you do when a massive student loan bubble results in crippling leverage for an entire generation of your population rendering them financially unqualified to obtain mortgage financing and their 'God-given right' to a slice of the 'American Dream'?  Well, you simply change the rules to allow mortgage lenders to ignore all that pesky student debt...anything less would simply be evil and potentially racist, sexist and all sorts of other -ist words.

Luckily, Fannie Mae is right on top of the issue and has just released new rules allowing millennial borrowers to, among other things, simply exclude student loans, credit cards and auto loans that are "paid by someone else"...wink wink...when applying for a new mortgage.  As an added benefit, taxpayer subsidized mortgage loans can also now be used to repay student debt...Hooray for taxpayers!

Fannie Mae announced new policies that will help more borrowers with student debt qualify for a home loan. These innovations address challenges and obstacles to homeownership due to a significant increase in student loan debt over the past decade and provide access to credit for qualified borrowers. The new solutions give homeowners the opportunity to pay down student debt with a mortgage refinance, allow borrowers to exclude non-mortgage debt paid by others as part of the loan application process, and make it more likely for borrowers with student debt to qualify for a mortgage loan by allowing lenders to accept student debt payments included on credit reports.

 

Student Loan Cash-Out Refinance: Offers homeowners the flexibility to pay off high interest rate student debt while potentially refinancing to a lower mortgage interest rate.

 

Debt Paid by Others: Widens borrower eligibility to qualify for a home loan by excluding from the borrower’s debt-to-income ratio non-mortgage debt, such as credit cards, auto loans, and student loans, paid by someone else.

 

Student Debt Payment Calculation: Makes it more likely for borrowers with student debt to qualify for a loan by allowing lenders to accept student loan payment information on credit reports.

 

“We understand the significant role that a monthly student loan payment plays in a potential home buyer’s consideration to take on a mortgage, and we want to be a part of the solution,” said Jonathan Lawless, Vice President of Customer Solutions, Fannie Mae. “These new policies provide three flexible payment solutions to future and current homeowners and, in turn, allow lenders to serve more borrowers.”

You know, because more debt is exactly the cure for millennials suffering the financial consequences of too much debt. 

But, at least this should help with inflating Housing Bubble 2.0.

Housing

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Tallest Skil's picture

Again, what’s wrong with the idea of using social media to artificially cause a run on the banks? Bring the motherfucker down on our own terms.

Croesus's picture

People have Always gone in debt over a nice Fannie...

D Nyle's picture

This is awesome, liberal douche debt slaves forever, bet next law will be the debt passes on to their children. We are going back to indentured servants soon and the libtards are to stupid to see it them

hedgeless_horseman's picture

 

...allow borrowers to exclude non-mortgage debt paid by others as part of the loan application process, and make it more likely for borrowers with student debt to qualify for a mortgage loan...

The bankers that are pushing this are fucking evil.

The borrowers are fucking stupid.

God bless America!

Saturday Night Live Debt Skit from ABI Videos on Vimeo.

Jim Sampson's picture

They lowered the minimum income and credit score here in Nevada recently.

johngaltfla's picture

So Fannie wants to enslave and kill the millenial generation with student and homeowner debt. Awesome.

Of course they aren't as evil as United, who apparently killed a bunny rabbit:

https://www.thesun.co.uk/news/3414045/brit-bunny-riddle-as-rabbit-destin...

AlaricBalth's picture

The things you own end up owning you.

espirit's picture

That's old school ponzinomics.

There is no repay for old loans.

You don't own what you can't carry away.

PT's picture

"That's the problem with impoverishing the peasants.  You have to pretend they are rich so you can lend them moar money."

- Old Bankster Proverb

Save_America1st's picture

the dude's last name is Lawless? 

well go figger

G-ray's picture

A friend just got the word to move out of the house he rents. (seattle market)   32 YO.  No credit history, No savings. $20/HR Job.  He was approved today for a 200K loan.  It wont buy shit in the city, yet.  They also told him if he can get a raise to 22 / hr they will up that to 250K (with 10K down)

Fizzy Head's picture

Brilliant on the banks, first it was stated income mortgage loans now is stated debt mortgage loans... Nothing bad could come of this...

alt right dude's picture

Do these homes come already fitted with a pair of migrants?

That would explain it.

 

PrayingMantis's picture

 

... snowflakes' mommies would be so thrilled they'd get their basements back ...

;)

Robert_Bichen's picture

alt right dude <<< Dailywesterner,com SPAMMER

VinceFostersGhost's picture

 

 

Hell yeah....as long as it's free.

Richard Chesler's picture

"Paid by someone else"

Just because you're paranoid doesn't mean they aren't after you. ..

HowdyDoody's picture

Yet another Weapon of Monetary Destruction.

 

The Gun Is Good's picture

MOAR HOAMES !!!

Always beware .gov use of the word "innovative." It usually means someone is gonna get fucked.

"Own" and "owe" are very similar, too. That means something....

(And here I thought millenials just wanted to live in a hybridization of Real World, their parents' basements, and a beehive? Wow.)

HooRAY4rSIDE's picture

The jews have it wired it don't they?

 

1. Counterfeit money at will (via the Federal Reserve & other central banks)

2. Lend it to jew bankers in the chain at zero interest

3. Jew bankers, in turn, (who, by the way, also control legislation arms, and the media propaganda arms, create a mass message that 'ownership' is a DREAM), lend it out, AT INTEREST, whatever interest, to anyone they can suck in.

4. If it all goes tits up, no problem, they use their disproportionately weighted government influence to institute new taxes (on the public), to bail out the private banks paper losses on loans that were made at zero risk to the jew bankers themselves.

5. As a bonus, the bankers can now call in the notes, and thus, own the properties that were constructed by the sweat & blood of commerce in FEE SIMPLE (& naturally, if they want, sell it off on the cheap to their fellow tribe).

6. Even though a few (outside the tribe), can SEE THROUGH this shell game and call them on it... At that point ~ the tribe pulls the 'anti-semite' card to silence the critics*** & bury such discussion down the memory hole covered up by a 6 foot dirt nap of bread & circuses.

 

Like, for example, the case of francis_sawyer***, who got kicked off of ZH 32x for doing nothing more than expose it (which is equivalent to being treated to two gunshots to the back of the head and calling it a suicide in the press).

veritas semper vinces's picture

Absolutely.

I think that until we expose the whole Holocaust lie and the 911 lie and get rid of the Federal Reserve,nothing is going to change.

But for this to happen,you need an informed,homogeneous population,with moral/spiritual values,something that Jewmerica completely lacks

nobodysfool's picture

What are you talking about? The "Govt" looks out for us and only wants the best for us.  That's why we pay them 50% of our earnings each year, so they can take care of us.

Ronald Reagan was so wrong when he said the 9 most dangerous words in a sentence were "I'm from the govt and I'm here to help."

Please don't disparage our efficient, honest and prudent govt.  Thanks and may God Bless.

;-) 

Government needs you to pay taxes's picture

I'd like to collateralize my $250K student loan debt in order to apply for a $500K mortgage.  

Yup, Im doing my part to grow the economy and step up from my starter debt to my dream debt.

mayhem_korner's picture

This just in: Parker Bros is releasing MONOPOLY! - FEDERAL RESERVE EDITION.

Same game as the classic, except:

  • The smallest denomination bill is $100
  • The largest is $50,000
  • Boardwalk goes for $40,000
  • Luxury Tax is $7,500
  • Landing on Free Parking nets you a bonus $1T Platinum Coin with the Bernank on the face, plus a side of Fukishima earless rabbit

That is all.

 

The Gun Is Good's picture

LOL! Nice!  Except that $100s are for CRIME, and prob'ly no cashola soon... so all on .gov digital SDRs maybe?

And wait... the GO TO JAIL thing would be on every third box or so... 'cuz the Prison-Industrial Complex and all.

And wait... there'd be the option for welfare/public housing buildings... and, oh, so much more fun to be had!  

Anyone? 

M4DM4N's picture

You never saw the Millenium edition???  Boardwalk was replaced with Times Square New York.  It can be yours for a mere $5,000,000.  The smallest denomination bill is $10k...largest is $5mil.

Bernardo Gui's picture

Until recently, you could still find a tear-down to buy here in Seattle. Not any more. Meanwhile, the skyline is jammed full of construction cranes building apartments. The middle class has all but vanished. Nothing left except the wealthy, overpaid millennial techies, and the poor and destitute. The voters constantly raise their own taxes to grow the local government, which is owned by public employee unions. That is the Blue State model.

waspwench's picture

True, absolutely true.   Seattle is Snowflake Central and the silly little fools think that the Big Benevolent Gubbmint is going to look after them in their Sanctuary City.   Only the wealthy can now own a house here.   Everyone else is expected to rent a rabbit hutch sized, expensive apartment where there is no parking because cars are evil and people must  use their bicycles (in one of the rainiest, hilliest cities in the country.)

Snowflakes always vote for warm weather.

N0TME's picture

Yeah and the head snowflakes are the mayor and the governor. Just ask Lars Larson.

fortune114's picture

Funny, I thought your comment was spam at first.

HooRAY4rSIDE's picture

They already 'BOUGHT THE FARM' with their student loan so why not complete the debt yahtzee with a house to go with it?

baby_tone's picture

I'm making over $7k a month working part time. I kept hearing other people tell me how much money they can make online so I decided to look into it. Well, it was all true and has totally changed my life. This is what I do... http://bit.ly/2jdTzrM

The Gun Is Good's picture

And if they buy a golden retriever or black lab with their home, LOWER THOSE RATES S'MOAR !!!

funthea's picture

Johnathan Lawless? What kind of person takes financial advice from someone named "Johnny Lawless"?

Besides, haven't we gone down this road before, when Perple Barney and Billy Clinton had Freddie and Fannie drop their standards the last go around? If I recall correctly, it didn't turn out so good. But hey, maybe this time will be different.

JRobby's picture

MOAR DEBT!!!

Now if we could somehow sneak in that carbon tax?

HooRAY4rSIDE's picture

I'm gonna need to take out a 2nd mortgage to pay for my carbon tax.

The Gun Is Good's picture

"I'm gonna need to take out a 2nd mortgage to pay for my carbon tax."

Rock that HELOC, baby, or even a reverse MOARtgage!

JRobby's picture

Exactly!!!! All by design. They even dreamed up the PACE funding plan to help you pay for it.  http://energycenter.org/policy/property-assessed-clean-energy-pace

Another layer of debt that is not FICO based and is collected through your property tax assessment. You just need home equity. So they are after the people that are not under water on their houses again but with a more stealthy approach. (your FICO battered by 2008-2017???? NO Problem!)

So far it is in place widely in CA (what a shock!) parts of FL and counties all over the US. But not widely enough yet for it to be noticable.

Twee Surgeon's picture

God bless America and help a confused dude try to understand how all this works?

If you are an 'Illegal Immigrant' that is OK and you can live in a Sanctuary City and that is OK but it does not apply to other crimes such as Robbing A Bank ?

Could someone rob a Bank in San Francisco and come out of the door with a bag of Loot and Request protection of the City, and keep the cash ?

Does Sanctuary City cover Rapists too, or just the Selected Crimes like sneaking in to the country while millions globally, stand in line  ?

A US serviceman marries a nice Korean girl and she pops out a few Spawn Stateside and then files for Divorce when the paperwork is good and starts importing family members while Joe the ex-soldier is made destitute by child support ? (Not me, but I have seen it happen to a few dudes.)

The so called Police........

Stalk the Highways under Color of Uniform on a Designated Drug smuggling highway and search for cash and goodies, take the stuff and force the Driver to prove he's not a dope dealer ? Catch a gambler at the Airport on his way to Vegas and his 10 grand cash gets confiscated ? Must be a drug dealer.

I personally met an old couple that were relieved of almost $4000 on a cheapo flight to Vegas. The Police took their cash ! They were in their 70's

Run a Bank and steal a Ton of hard fought wealth from thousands of your neighbors and walk away scot-free ?

There is no Law in the land other than what the Tape worms say it is today. This is a grand sign of some entity trying to create a disturbance among peaceful people. This stuff will not go away while Insiders are Inside the Government provoking collapse, it is probably too late now but when the shit does come, no mercy for the Complicit.

 

INTJ Economist's picture

Or the borrowers are brilliant if they consolidate and then declare bankruptcy.

canisdirus's picture

This is a backdoor route to clearing college debt through bankruptcy. Brilliant.

localstorm's picture

I was thinking precisely about the same.

MisterMousePotato's picture

Just like paying taxes with credit cards.

Because there are some gotchas with that, well, just pay for everything else (food, gas, utilities, etc.) with credit cards, freeing up cash for taxes, and then bk. (Remember ... money is fungible.)

Any sensible long-term financial plan should include regularly paced bankruptcies. It's the only way for the little guy to get even/get ahead.

Macavity's picture

Nice one, mate. As I see it, partly thanks to you, this might achieve:
- repays Dept of Education which funded (actual money perhaps, or govt debt, perhaps not bank magic wand funny money)
- prevents or softens a housing price crash
- prevents debt-addicted system meltdown (which could also perhaps threaten USD hegemony)
- student debt becomes bankruptable after being refinanced into mortgage debt (unless that aspect survives the transformation)
- ... For those that can afford combined debt, they're squeezed more than any generation before,
- ... For those that can't, they'll either go bankrupt or get sucked into debt consolidation

But holy ducking shite! Do you think that the US money (not monetary) system is predatory?

funthea's picture

- student debt becomes bankruptable after being refinanced into mortgage debt (unless that aspect survives the transformation)

Actually, no bankruptcy needed in most cases, as most states use trust deeds. In trust deeds there are no deficiency judgements, only forfiture of the property. Any deficiency is simply absorbed by the bank. Winning!

Macavity's picture

Thanks, funthea.  Do you mean that the creditor seizes the guarantor's collateral that has been placed in a trust?  What happens on "deficiency":  full seizure or just enough to pay off outstanding payments?

Macavity's picture

I love (mega-loathe) it how banks talk about "risk" when in an objective view of reality, there is none (for them).  One, collateral.  Two, the loan was poofed out of thin air in the first place.

new game's picture

just moar free shit lumped on overall debt burdenwhich in turn is a burden on the producers of wealth creation.

then there is tax code of evasion of taxes which favors the wealthy...

20 trillion and stoking higher.

all good in the neighborhood...