I'm arguing that the current rate is without the additional percentages that the insane risk premium that would be attached to these loans, if they were made at all.

> is already jacked

If you're arguing why it's not the same rate as treasuries, I'm not sure what more I can say. There's more that goes onto pricing loans than just the risk premium. It's a part of it, but not the whole story ("why are government-backed MBSes not the same interest rate as treasuries?").

Furthermore, just look around: you sure there's no "risk" with these loans? You cannot in honesty argue otherwise.