Fannie Mae and Freddie Mac have agreed with New York Attorney General Andrew Cuomo to let banks and lenders do their own appraisals on mortgaged homes. This move allows for private home appraisals to be done by the lenders themselves which was previously prohibited. The agreement came after the attorney general’s office opened an investigation on the mortgage sector, which has been experiencing internal bleeding due to the subprime crisis brought by an increase in foreclosures.
Well, the agreement might contribute in stopping the hemorrhage in the mortgage industry. Fannie Mae and Freddie Mac’s decision to let independent home appraisals would surely boost the confidence of lenders in issuing mortgages. This new system will then be used to determine the value of a property being mortgaged and repacked for securities investments.
Posted by Jones on January 3rd, 2009 :: Filed under $$$ CRISIS, EVERYDAY MONEY STUFF
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