“If they do stop guaranteeing 30 fixed mortgages then even fewer people would qualify for traditional conventional financing and that would create even more Seller Financed Notes for us to go after!” — Jeff Armstrong, Armstrong Capital www.ArmstrongCapital.com
The letters FHFA may not mean much to you, but the Federal Housing Finance Agency has a lot of power over the way houses are paid for in this country. President Donald Trump’s new nominee to head the agency, Mark Calabria, would likely make some changes if confirmed by the Senate. Calabria is currently chief economist for Vice President Mike Pence and a long-time critic of Fannie Mae and Freddie Mac, the two mortgage finance companies the FHFA oversees. One change the libertarian-leaning economist has recommended in the past: ending government support for the 30-year fixed-rate mortgage.
Stretching a loan over such a long period makes monthly payments more affordable, said Edward Pinto with the American Enterprise Institute, but ultimately makes homes more expensive.