Word came late last week from both the Federal Reserve and the White House that the federal government does not intend to stand by and watch the housing and credit crisis drive the country into recession. President George W. Bush announced a series of proposals intended to help homeowners faced with mortgage defaults and Federal Reserve Chairman … [Read more...]

Bush will apparently propose reforms to the Federal Housing Administration (FHA) which would allow the FHA to insure 80,000 more loans, a 50% increase in FHA-insured loans. Assuming an $200,000 loan size for subprime loans originated in 2005-2006, with roughly $30 billion in resets per month over the next year, this works out to around 5% -- … [Read more...]