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[ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] Re: default reserves Posted by SeanW on May 23, 2003 at 6:41 PM In Reply to: Re: default reserves posted by Travis-CA on May 23, 2003 at 3:54 PM >>If loans do not perform that they purchase, they [Fanny & Freddie] will usually just force the lender to take the loan back in trade for a good loan. I think there's more to it than even that. Loans are originated and sold "with recourse" and "without recourse". My understanding is that some lenders prefer writing loans without recourse. Fanny & Freddie pay less for these... but those lenders like being able to write lots of loans to crummy credit risks, and sluff them off onto Fanny & Freddie. Follow Ups: Post a Followup: Name : E-Mail : Subject : Comments: : >>If loans do not perform that they purchase, they [Fanny & Freddie] will usually just force the lender to take the loan back in trade for a good loan. : I think there's more to it than even that. Loans are originated and sold "with recourse" and "without recourse". My understanding is that some lenders prefer writing loans without recourse. Fanny & Freddie pay less for these... but those lenders like being able to write lots of loans to crummy credit risks, and sluff them off onto Fanny & Freddie. Optional Link URL: Link Title: Optional Image URL: [ Follow Ups ] [ Post Followup ] [ The Forum Board ] [ FAQ ] WWWAdmin 2.0a © 1997 Matt Wright and DBasics Software Company, All Rights Reserved

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