there's no question that we need a gsc reform package. don't know that we want to have the taxpayers eternally bailing out all of the various companies including the mortgage giant. so, thank you very much for being here. >> thank you. >> thank very much. and now we'll hear from mr. adler from new jersey. >> thank you mr. chairman. mr. lockhart i want to follow-up on some questions. my sense is that mortgage insure percent lack the capital to underwrite new mortgages. i'm wondering what you think the fha could do to that problem for america? >> that's a good question. as you know fanny and freddie cannot write mortgages above 80% loan to value to they've relied historically on mortgage insurers and in the more recent past something called pi giggyb insurers. the mortgage insurers like many other players in the mortgage market, took some very significant losses and their capital has been completed and that's meant that they can do less mortgage insurance than they have in the past. and rightfully so, they tightened their standards as a res

they have to have stellar credit to get a good loan and if gscs were not in the market they wouldn't make any loans in california to be honest, because they're the only ones willing to lend. ems can't sit on the loan for that long time because they don't have the liquidity to do it. they go to their realtor or local mortgage broker trying to package a loan for them and go out and shop the loan. the marketplace it seems like we're making it much more difficult and hamstringing it in more ways by saying, an agreement that, perhaps works in new york and maybe it's goodor the state of new york, i don't know -- but it doesn't seem to be the best thing for the state of california and many other parts of the nation, to make it much more difficult and place much more control in the hands of one bank rather than having an individual being able to shop a loan with numerous banks. because the problem is, if you approach a bank for a loan they'll do the appraisal and you can't take it to another bank because the appraisal is proprietary property of the lender. i don't know why we're going in thi