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My understanding of this plan is it does not require government funding. Some mortgage companies would freeze interest rates if the homeowners meet certain criteria.
The states would float tax-exempt bonds to fund the refinancing of loans. The states are already floating bonds to help first-time homebuyers drive up the cost of housing. The cost will be covered by higher real estate taxes and fees imposed on the rest of us.
george bush is not my favorite president however, in 5 years the housing market will not be in a nosedive and prices will be back up. its not a horrible move. it is a short term fix, it will stagnate investment but this will be offset by termination of the war. this is of course assuming we terminate the war soon. i think one of either party will do this soon. if they do not terminate the war, all bets are off.
The housing market "collapse" is really just a return to reality from a rash of speculation. The same thing happened with tech stocks during the previous administration and I could go back and point to this sort of thing happening over and over through history. (Silver in the 1970's anyone?)
So, I'm failing to understand why you start your post with George Bush when in reality this is a result of us having freedom to make decisions (sometimes dumb ones) outside of the govenment controls.
The vast majority of the foreclosures are a direct result of overspending.
The problem that occurs to me most about any sort of "bail-out" is: what about the folks who've already lost their homes (and backsides) because of the ARM's? The bailout comes too late for them. Doesn't it?
And no, it's not fair to the folks who could afford to be responsible and didn't need to rely on an ARM to get their home - but whacha gonna do?
That's what I was saying! You have people here in the Pocono's who's foreclosure woes became national news, sparking a lot of controversy, a foreclosure study & other investigations into the home building/lending industry. Those "victims" who originated loans in the early 2000's through 2004 are entitled to nothing?
No it is a slap in the face of tax paying, law abiding citizens!
Being resposible is what our country is all about. There is a pattern here, you just need to connect the dots.
The liberty is sliding off our coinage. Back door socialism.
That's what I was saying! You have people here in the Pocono's who's foreclosure woes became national news, sparking a lot of controversy, a foreclosure study & other investigations into the home building/lending industry. Those "victims" who originated loans in the early 2000's through 2004 are entitled to nothing?
Of course they're not, neither are the folks who are being helped by the interest rate freeze.
This is not about helping homeowners. It's about keeping the US banking industry solvent. Gotta give the big boys time to try and clean up some of the toxic loans on their books.
Just a month ago Paulson said that a "government fix" wasn't necessary.
IMO the difference now is either:
A. Bush et al don't want to be accused of sitting by and doing nothing. They feel like they have to come up with some kind of plan to win favor with the electorate.
Have you seen what Hillary is proposing? We're talking government aide in the billions thrown at the mortgage mess.
B. They've got to prop up the economy somehow and since the only thing that has kept it chugging along is consumer spending (via equity ATM in large part) they've got to at least slap a band-aid on the mortgage mess, and quickly.
Btw, the first rumblings I heard about the freeze were that it would be for 6 months, now it's 5 years? Just highlights how serious they view the problem to be IMO
The Treasury is about to announce a plan to bailout irresponsible homeowners and enrich mortgage companies. Is this fair to those who carefully considered the contract that they were signing or is it yet another government giveaway?
I heard about this on the news and I think it's BULL (you can fill in the other word). My husband and I are 30 and going to be first time homebuyers. As tempting as it sounded to buy with the ARM rates or other variable rates, we opted against it and decided to do it the old fashion way: 20% down payment, fixed rate. We are still currently saving. We totally resent the fact that these home owners are getting "help" because they were too stupid to realize that rates will GO UP and their $500/mo morgtage will triple, quadruple or whatever in 3 yrs. In the end, I bet we, the RESPONSIBLE homebuyers will be the ones "paying for it" while the big mortgage companies and idiot homebuyers get relief from the government. Perhaps I am thinking illogically (I probably am) but I'm really angry about all this!
If its completely up to the discretion of the lenders to decide which homeowner's are truly eligible for this program...maybe not as many people as we think are going to be helped.
If its completely up to the discretion of the lenders to decide which homeowner's are truly eligible for this program...maybe not as many people as we think are going to be helped.
Very rational thinking! Lets not all jump to conclusions. It might
not be as easy to get the frozen rate. Many are just too little to
late to be helped. Oh well, lifes tough eh?
The next step is for the attorneys to step in with class action lawsuits.
Say Mr. Jones took out a no-doc liar loan to buy a McMansion that cost six times his annual income and Mr. Smith took out a full-doc loan on a fixer shack that cost two times his annual income, even though he REALLY wanted a McMansion like the Joneses. Mr. Jones would have lost his ill-gotten McMansion, if the teaser freezer didn't enable him to keep it at a discounted rate for five more years. So Mr. Smith is paying a higher interest rate for being honest, while Mr. Jones gets a lower rate for defrauding his lender. Not exactly a level playing field, is it?
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