According to Gabor S. Acs, Founder of the Infinite Freedom Foundations it would run much better if Fannie Mae and Freddie Mac, holders of ten trillion dollars worth of interest bearing debt, more than two trillion of it in various stages of default, restructuring, modification or refinancing (refunding) were merged into the Infinite Freedom Foundations of America.
"We have been working behind the scenes with our business partners around the planet to present to the Obama Administration a proposal that will create a financial boon for more than 100 million homeowners and create jobs in the long run for 43 million poverty stricken people in America, said Gabor for this exclusive interview.
The proposal includes taking both troubled institutions private. Both are currently more or less in receivership since they were bailed out with more than $200 billion in U.S. Government aid during the mortgage market implosion which this author predicted 18 months before it happened.
The U.S. Government currently owns 80% of the stock of both organizations that employ ten thousand people who would need to be retrained and reorganized into a massive undertaking of rewriting all the owner occupied mortgages in America at zero interest.
A zero interest mortgage can be originated, processed, underwritten, and sold in the secondary market at a fair and profitable discount. The benefits to America are huge! It would reduce the necessity of government intervention in the mortgage industry and replace all interest bearing mortgages on owner occupied properties with principal only mortgages that build real wealth, lower the overall cost of housing to the entire industry, and provide real homeownership in the long run.
"People who take out mortgages these days rarely pay them off over the term of the loan. The average life of a mortgage loan in America has fallen from 7 years to five years over the past couple of years due to the high rates of default and restructuring that has been going on since foreign investors discovered the fraud contained in trillions worth of mortgage paper that is being put back to banks and mortgage companies by Fannie and Freddie.
Over the past three years Fannie and Freddie have only been able to put back approximately $25 billion in bad loans to the banks that sold them to these former non government finance agencies. With increasing oil and food prices, America cannot afford to keep making mortgage payments on a overly inflated housing market, and with prices still a long way to go before they hit bottom, despite all the deceptions published by Realtors and uninformed mortgage bankers.
The answer is a zero interest rate policy, but it must include repealing the tax deduction on interest bearing housing debt for owner occupied homes, so that America can rebuild its financial health. America is now ranked only 9th in terms of financial health around the world.
"We are proposing to hedge funds such as Soros Fund Management, and other civil society non profit organizations such as the Open Society Institute founded by George Soros Sr. the creation of a new secondary market in zero interest owner occupied mortgage loans which help consumers who are struggling with the stress of their current debt burdens on their homes," says Gabor.
Gabor is scheduled to speak on Blogtalkradio on the subject this coming Saturday, as well as "All Day Live", a Seattle Television Show in Seattle next Tuesday.
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