Why U.S. Home Mortgage Interest Rates Are Lower and Terms More Lenient Due To Government Involvement

Why U.S. Home Mortgage Interest Rates Are Lower and Terms More Lenient Due To Government Involvement

In this video we compare housing finance in the U.S. to Denmark. We will see how the U.S. government is involved in the issuance of 90% of all residential mortgages via Freddie Mac, Fannie Mae and Ginnie Mae. This allows homeowners to escape personal liability if they default as investors in mortgage-backed securities are protected from credit risk.

That is not the case in Denmark where homeowners are personally liable. As a result, default rates in Denmark on home mortgages are much lower. Mortgage rates in Denmark are also lower. For more information on this topic, see Episode 238 of Money For the Rest of Us. https://moneyfortherestofus.com/238-u-s-socialist-denmark-home-mortgages/

Money For the Rest of Us is a personal finance channel on money, investing and the economy with new videos released every Wednesday.

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