Government fuels next housing collapse with unstable mortgages

housing

By Pahousing ul Sperry | New York Post

Nobody wants to return to the kind of risky home loans that spurred 2008’s banking collapse. Sliding back toward lax lending would be nuts.

Yet Washington officially endorsed such loans this month.

Federally controlled mortgage giants Fannie Mae and Freddie Mac announced they’ll back loans to low-income Americans who put just 3% down, even though such loans have a high default rate.

The risky mortgage program has the blessing of Federal Housing Finance Agency chief Mel Watt, the former Congressional Black Caucus leader whom President Obama recently appointed to regulate Fannie and Freddie.

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