mortgage crisis helped agencies

mortgage market in the near future will be dominated by Fanni, Fred, FHA --private enterprise's role is narrowing in many instances to the job of arranging loans, providing the initial funding until the loans can be sold, and handling the monthly paper work --it means the end of era of easy approvals on mortgages. --lenders are more leaning on 12 regional Federal Home Loan Banks, which are cooperative chartered by Congress but owned by commerical banks and other financial institutions. TheHome Loan Banks' loans to financial institutions are referrred as "advances" --the portion guaranteed by Fiannie and Freddie has rebounded to around 72% in Oct from 41% in 2006 --irony in Fanni/Fredi: flip-flop their cap because government thought their dominance would disrupt the financial system --Federal Housing Administration (FHA) is expected to gain more than 10% of mortgage securitization market from 2% last year. --Total U.S. residential mortgage debt outstanding swelled to 10.3 tril at the end of 2006 --mortgage lending is volutible business. the cleanup of the saving-and-loan (S&L) mess of the late 1980s, when more than 1000 thrift institutions collapse, cost U.S taxpayres an estimated $124 bil. roles lenders (say Countrywide) first borrows money from FHLB or FDIC, originated mortgage loans, and sold them to agencies, such as Fanni, Freddi, and FHA who securitized and sold them into secondary market. Where, Fanni, Freddi, FHA also are mortgage insureres, charging compenstation fees for taking the risk.