Vancouver Wa Real Estate Blog

What’s Next in Real Estate for Fannie and Freddie?

What’s to become of Fannie Mae and Freddie Mac, which are bleeding red ink as home owner defaults continue to increase?

The rising losses will force the government to decide whether to keep putting money into the firms to keep them operating or divide them into smaller businesses and remove government support.

Daniel Mudd, a former Marine, was Fannie Mae’s CEO before the government fired him and put James Lockhart, director of the Federal Housing Finance Agency, in charge. He likened the situation to the U.S. invasion of Iran. “The troops got to Falluja in a couple of weeks and seized the radio towers, but there was no plan to run the country once the shooting stopped,” he said.

Under the Obama plan, Fannie and Freddie are expected to refinance as many as 5 million underwater mortgages.

Fannie’s government-appointed CEO, Herbert Allison, said: “It’s not about maximizing returns on equity or profits. It’s really about being of use to the country during this very difficult period.”

Source: The Wall Street Journal, James R. Hagerty and Damian Paletta (02/27/2009)

Crystal Boldt Mortgage and Financing

Vacant Clark County Properties Raise Insurance Risk

Rising vacancies in commercial property increases insurance risk and ultimately the cost of insurance, warns the Chubb Group of Insurance Companies.

Chubb Group points to studies by the National Fire Protection Association that show an average of 14,900 fires a year occur in vacant buildings, causing more than $118 million annually in direct property damage. In addition, theft, vandalism, water, collapse and wind losses increase in vacant real estate.

The insurer offers these suggestions for owners of vacant commercial real estate:

Read the policy carefully for any policy terms and conditions applicable to vacant property.

Notify the insurer that the property is vacant.

Remove furnishings and all combustibles from the premises.

Advise local authorities that the building is vacant, including fire and police departments.

Inspect the facilities weekly. Consider hiring a guard service to drive by daily.

Source: Chubb Group of Insurance Companies (03/13/2009)

via REALTOR® Magazine-Daily News-Vacant Properties Raise Insurance Risk.

Crystal Boldt General