The latest term in the real estate mortgage meltdown is Bank Buyback. The quick explanation is: when the FHFA (Federal Housing Finance Agency) says that if a mortgage file has some flaws, mistakes, and/or improprieties, the originating entity must "buy it back." Thus, the bank, mortgage company, and even the originator could be asked/forced to buy back a loan that was funded because of improper underwriting and/or faulty documentation.
This has huge economic ramifications. Imagine if those banks that sold loans to the secondary market are asked to buy back many of those loans. Some of the major "lenders" have financial exposure in the tens of billions. They might have to come up with huge sums to satisfy their agreements to "buy back" faulty files.
This is going to be another hit on the American real estate market. How big a hit is still developing. There are numerous rumblings in blogs and on financial sites that are much more well versed in this topic than I am. I suggest we start learning enough to understand what is going to happen.
Here are some links to get you started:
Heath Coker, Associate Broker
Robert Paul Properties
www.CapeGroup.com / firstname.lastname@example.org
508-274-5613 Licensed in MA
Its a beautiful day on Cape Cod!
@CapeGroup Skype: heath.coker