WTF: Biden is FORCING Affirmative Action on HOUSES for SALE!

well good old Joe Biden and the Biden

Administration are now bringing

affirmative action to real estate

maybe not directly but to some extent

yeah there is now a new announcement out

from the Biden Administration that

listen to this they are going to hike

payments for good credit home buyers to

subsidize higher risk low-income

minority borrowers that's right so if

you've done right with your finances you

have a higher credit score and a higher

down payment you're now going to have to

pay a higher monthly payment to

subsidize people who just didn't operate

their finances as well on one side

people are arguing hey well In fairness

maybe you had the better opportunity to

go to a better school because you were

in a minority on the other side people

are like f that I worked my ass off to

get where I am and I shouldn't have to

subsidize somebody else that's the

government's job not my job government

shouldn't be making it more expensive

for me to operate because somebody else

didn't

do as well well that's exactly what's

Happening Here home buyers with good

credit scores will soon encounter a

costly surprise the article speaks

home buyers will be forced by a new

federal rule to pay higher mortgage

rates and fees to subsidize people with

riskier credit profiles who are also in

the market to buy homes effective May 1

the fhfa the federal housing and Finance

Agency will push for more affordable

housing and they will enact what are

called loan level price adjustments to

make it more expensive for you if you

have a higher credit score here's

basically how that works basically the

way it works is usually when you go into

a bank you might see something like this

you might see okay if you have a 740

credit score we'll give you a rate of

6.5

okay you have a 720 credit score we'll

go ahead and give you the 625 or the

6.75 but we're going to go ahead and hit

you with a low level price adjustment of

20 basis points right you have a 700 you

might get that 6.75 plus 0.40 right and

this is usually the kind of metric and

I'm making this this metric up but this

is just to make it simple math kind of

what it looks like when you go qualify

for a loan every 20 points your credit

score is lower you tend to have to pay a

little bit more of an interest rate and

you either pay this in a higher interest

rate or in higher points so it's either

rate or points points are basically the

loan fees that you pay so these basis

points could be part of your interest

rate or they could be part of the points

you pay and usually you get the best

pricing at 740. but basically what the

Biden Administration is now trying to do

is they're trying to distort the normal

way this looks and they're basically

trying to say hey if you have like a 740

credit score and you're doing the right

thing you're putting 15 to 20 percent

down you were going to take those Rich

borrowers and we're going to potentially

charge them forty dollars a month on a

400k property we're gonna give them a

low level price adjustment we're going

to charge whoops we're going to charge

those people more money and as we charge

these rich people so to speak even

though they could be first-time home

buyers too who just got off on the right

foot or or are trying to do the right

thing we're gonna charge them more money

because that way we won't have to charge

these people more money who are more

risky who have a riskier credit profile

who should be paying higher rates

because they're more risky but the Biden

Administration says no we don't want the

free market to charge riskier borrowers

more money we're going to charge the

safer borrowers more money because the

riskier borrowers are more likely to be

Black Or Hispanic and the higher credit

profile borrowers are more likely to be

white so because we want more racial

support and racial equity and we want to

guarantee more equal results for people

rather than just equal opportunity given

that no matter what your race is you

have the Equal Opportunity of getting

transparent pricing based on a higher

credit score rather than letting the

free market do its work the buy the

administration would prefer to just

charge richer more predominantly white

people more money and give that to the

riskier borrowers now that's my

explanation of it but let's just go

ahead and see that example in writing

from the the uh the research piece here

which has mortgage industry Specialists

say home buyers with credit scores of

seven is 680 or higher will pay about

forty dollars more per month on a home

loan of four hundred thousand dollars

home buyers who make down payments of

fifteen to twenty percent will get

socked with the largest fees now do keep

in mind in my example just to make it a

little bit more clear I have implied

that 680 was closer to the bottom keep

in mind you could buy a home all the way

up to like a 600 and 580 and 620 credit

score so maybe I should have drawn this

all the way down here and basically said

this whatever it's the same thing the

point is the higher credit score people

and the ones putting 15 to 20 down

they're gonna pay the largest fees

the new fees will start for people who

buy or refinance refinance as well after

May 1. here it is an individual in the

Bay Area who works for Bay Equity Home

Loans who says these changes don't make

sense penalizing borrowers with larger

down payments and credit scores will not

go over well and it's also confusing to

Borrowers

and here's someone else the president of

the National Association of Realtors uh

let's

big position here who says in the wake

of three percentage Point increases in

mortgage rates now is not the time to

raise fees on any home borrowers and the

fhfa says that the fee will increase

pricing support for borrowers limited by

income or wealth they say the overall

charge is minimal I hate to say it but

every 40 bucks with how expensive things

are every 40 bucks is a little more than

minimal if you think about it that's

about 500 more per year

that's basically making home ownership

more unaffordable for the people who

made sure they had the best credit score

the best income it seems like a slap in

the face to people trying to do the

right thing

the agency is also instead now going to

delay a fee for people with higher debt

to income ratios so in other words

they're burning the candle at both ends

of the stick they're basically saying

okay people with higher debt levels were

not going to charge them more money

we're going to delay that fee until

August for people with more debt and

instead people with less debt higher

credit scores and more down payment will

charge them more sooner

so in other words the goal here is to

subsidize risky or riskier borrowers

listen to these segments the fee changes

are intended to subsidize high-risk

borrowers by imposing an intentional

disruption to the traditional risk-based

pricing exactly it's the rich paying for

the poor why is it and it's not even

fair to call rich people first time home

buyers putting 15 down they're not rich

that's just the way they're trying to

cast it so maybe I should stop saying it

it's more the financially potentially

capable versus the incapable I don't

know anyway why was this done the answer

was simple it was to try to narrow the

Gap in access to credit especially for

minority home buyers who often have

lower down payments and lower credit

scores I wrote this is basically

affirmative action for housing you're

basically saying hey if you're black or

you're Hispanic or you're a minority to

some Next Step you get easier access to

home ownership and if you're white you

get worse access to home ownership which

is basically what happens at comp or or

should I say schools like Harvard or Ivy

Leagues or a lot of colleges where

colleges say hey the test scores we

require from a white male are higher

than the test scores we require from a

blackmail

okay the thesis is that that should be

sort of a way to repay for prior

struggles uh that uh black families Or

Hispanic families may have had because

maybe they grew up in a more

poverty-stricken area which had worse

schooling worse opportunities for jobs

worse internships worse job growth

opportunities or mentorship

opportunities worse Financial education

my response to that is all of our

schools mostly suck most of them should

be revised with substantial Financial

education and rather than trying to fix

the problem here why don't we go to the

root cause and rather than screwing up

the economy why don't we go to the root

cause and start actually spending more

to fix our schools by instituting

Financial education programs in all of

our schools but start with the poorest

fix the schools in the poorest areas

first then introduce more financial

education the poorer areas start

actually fixing the root cause rather

than trying to bandage the problem but

no no the government would rather do

this she once again is backwards but

it's probably a way of attracting voters

and the Democratic base anyway the Gap

in home ownership opportunity is real is

the argument on one side that hey maybe

this will help lessen the gap between

home ownership and it's true white

individuals own substantially more homes

than black individuals black individuals

are much more likely to be tenants than

white individuals and unfortunately when

it comes to net worth we know this

because I teach it on my channel

regularly and I have courses on building

your wealth specifically zero to

millionaire real estate investing we

know that the average net worth of a

tenant is somewhere around

180 or sorry uh the average net worth of

a homeowner is somewhere around 180 000

whereas the average net worth of a

tenant is somewhere around a paltry five

thousand six hundred dollars so you have

a massive disparity between net worth

between homeowners and tenants

and unfortunately uh home ownership is

Out Of Reach for some folks because of

their jobs their debts their credit

scores or otherwise but the Biden

administration's solution here seems to

be to reward poor financial decisions

rather than going to the root cause of

the problem maybe providing more

opportunities in school and more

education for people in school than

trying to bandage the problem like this

which just ends up creating more

disparities in the free market economy

of home ownership in other words people

who are saving more money shouldn't be

punished for having a better credit

score and having saved more money than

individuals who have a worse credit

score it seems backwards it actually

feels

anti-American to say that the people who

worked the hardest to have the best

financial standing should pay the

highest fees feels backwards but then

again the other side is making the

argument that well In fairness because

of like affirmative actions style

policies this is what we want to do

that's what the Biden Administration is

up to so think about that and take it

for what you may