As one former GSE stock analyst told us: “There’s no way they can be privatized. To maintain an AAA rating they would need 25 percent (I’m guessing) capital to assets. Even at 5 percent there is not enough spread to earn a market return on capital.”
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Lenders interviewed by Inside Mortgage Finance were disappointed with the news that the MIP reduction would be scuttled, though some factions of the housing industry remain optimistic.
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