Let?s shift the blame to the underwriters!

What Underwriting Guidelines Would Make a Difference? Fannie and Freddie's lack of a disposable income test is one reason why we find ourselves in the mess that we're in. Their "conforming" stamp of approval means that so many lenders don't truly have to bear the all consequences of their actions.  So they don't take time to come up with guidelines that make a lot of sense. Don't you think a local bank, forced to eat its mistakes, would come up with rules that pretty much guaranteed them that they were making mostly good loans? You betcha. By putting things in the "conforming" wrapper, people don't see issues like yesterday's borrower's real world weakness. The answer is not as simple as "cut loan to values," and "increase documentation." There are high LTV, high ratio loans t