Subprime and Freddie Mac
Freddie Mac's Chairman and CEO, Richard Syron testified on April 17th before the U.S. House of Representatives Financial Services Committee regarding subprime mortgages.
Some highlights of his remarks:
"In addition to tightening underwriting standards, we are currently working on a major effort to develop more consumer-friendly subprime mortgages. Ready by mid-summer, these offerings will include 30-year and possibly 40-year fixed-rate mortgages and ARMs with reduced margins and longer fixed-rate periods. We are designing these products to have a significant ameliorative effect on subprime going forward."
"First and foremost, regulation is needed to ensure that borrowers have the information they need to make informed mortgage choices. To be most effective, consumer disclosures need to be uniformly and consistently applied."
Excellent and especially regarding ensuring borrowers having information to make informed choices. Let's hope the disclosure is written in such a way as to be easy to read and understand. Please read the complete remarks made by Mr. Syron.