It's known as the 'Oops' loan market – where Fannie Mae/Freddie Mac lenders get jammed on a buyback request not because the loan is delinquent, but because one of the GSEs finds an underwriting flaw and demands a repurchase or damages. The seller/servicer then takes that loan and resells it to another buyer. We're told that lately Oops sellers are asking for upwards of 90 cents on the dollar for these loans, although over the past year the going price has been 70 to 80 cents a share. What does this piece of market intelligence tell us? Answer: Perhaps the housing market has hit bottom – or someone is dreaming.
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