Date : February 19th, 2010Category : UncategorizedAuthor : Editor11 Comments
Statement by Senator John McCain, May 25, 2006:
Mr. President, this week Fannie Mae’s regulator reported that the company’s quarterly reports of profit growth over the past few years were “illusions deliberately and systematically created” by the company’s senior management, which resulted in a $10.6 billion accounting scandal.
The Office of Federal Housing Enterprise Oversight’s report goes on to say that Fannie Mae employees deliberately and intentionally manipulated financial reports to hit earnings targets in order to trigger bonuses for senior executives. In the case of Franklin Raines, Fannie Mae’s former chief executive officer, OFHEO’s report shows that over half of Mr. Raines’ compensation for the 6 years through 2003 was directly tied to meeting earnings targets. The report of financial misconduct at Fannie Mae echoes the deeply troubling $5 billion profit restatement at Freddie Mac.
The OFHEO report also states that Fannie Mae used its political power to lobby Congress in an effort to interfere with the regulator’s examination of the company’s accounting problems. This report comes some weeks after Freddie Mac paid a record $3.8 million fine in a settlement with the Federal Election Commission and restated lobbying disclosure reports from 2004 to 2005. These are entities that have demonstrated over and over again that they are deeply in need of reform.
For years I have been concerned about the regulatory structure that governs Fannie Mae and Freddie Mac–known as Government-sponsored entities or GSEs–and the sheer magnitude of these companies and the role they play in the housing market. OFHEO’s report this week does nothing to ease these concerns. In fact, the report does quite the contrary. OFHEO’s report solidifies my view that the GSEs need to be reformed without delay.
I join as a cosponsor of the Federal Housing Enterprise Regulatory Reform Act of 2005, S. 190, to underscore my support for quick passage of GSE regulatory reform legislation. If Congress does not act, American taxpayers will continue to be exposed to the enormous risk that Fannie Mae and Freddie Mac pose to the housing market, the overall financial system, and the economy as a whole.
I urge my colleagues to support swift action on this GSE reform legislation.
—— The above is fact – McCain was on this case well before Obama.
The New York Times has charged that McCain-Palin campaign manager Rick Davis was paid by Freddie Mac until last month. Fact is Mr. Davis quit from his consulting firm in 2006. Mr. Davis has seen no income from Davis Manafort since 2006. Davis was not a registered lobbyist since 2005. This is just a lie.
People, get away from the media, and read!!!
Thanks Mavericky Maverickness, your absolutely right about the Canon and Cannon. I’ll be sure to watch my speling…
As for the above joke, (on canon and cannon and speling…) if your entire opinion is based on my misspelling of a word, why are you here? Someone even used a colorful metaphor to describe me based on this. One correction is appreciated, and honestly thanked for pointing out my error. All following are lemmings. This all detracts from the original point, which is what the democrats seem to be good at.
If you only need the money for a short period of time and then can repay the full balance, a home equity loan would probably be a better fit then a reverse mortgage. Why? Because a reverse mortgage is mostly for homeowners who do not intend to pay back the money they receive during their lifetime.
2. Spouse not on title
If the title to your home is only in your name but your spouse is still living with you, you should add your spouse onto the title. A reverse mortgage must be repaid when the last person on the title moves out of the property permanently or passes away. Therefore, if you were to pass away before your spouse and your spouse was not on title, the reverse mortgage would become due even though your spouse is still living in the property.
3. Don’t need the money
If you don’t need the money right away, then you probably should not rush to take out a reverse mortgage. The interest on a reverse mortgage is low but it is not interest free. If you have other funds that you can use such as CDs or savings accounts, use those before considering a reverse mortgage.
4. Risky investments
If you are being encouraged to get a reverse mortgage so that you can use the money to invest in stocks, start-up companies, real-estate, or any other type of investment, you should take a good hard look at what the person encouraging you stands to gain. Chances are they’re asking you to take big financial risks at a time in your life when you should be conservative. If your home is your only asset, don’t risk it.
5. Annuities
Dishonest life insurance salespeople will often encourage homeowners to take out a reverse mortgage and then try to sell the homeowner an annuity. However, be warned that is wasteful because the reverse mortgage has a built-in annuity feature called “term” or “tenure” payments that you can use to save yourself the commission that the insurance agent would like to make.
6. Low property value
On low-value homes, the closing costs will be a higher percentage of the home’s equity compared to the same loan on a higher-priced home. For example, if the miscellaneous closing costs such as appraisal, title, and notary are $1,000 on a $100,000 home then that represents 1% of the home’s value. However, on a $40,000 home that represents 2.5% of the home value. Therefore, senior citizens with low-value houses should look closely at the closing costs as a percentage of their home’s equity.
