Vote them out? It's going to be impossible. Romney will likely win the Rep nomination (I realize it ain't over yet) so we'll have a choice between him and Obama -- two Wall Street puppets with Romney being the worst of the worst. Every candidate we get to choose from is sent directly from Wall Street. It's pretty clear who runs the country.
The entire mortgage market has been taxpayer-backed since they introduced the GI Bill (a bit before, even). What exactly do people expect to happen? A "normal" mortgage is a 5-7 years, 50% down, interest only balloon. That would absolutely collapse housing prices. I can't think of a single person running for office in the past 50 years that would accept that - not even the great libertarian himself, Dr. Paul. There is no fundamental difference between knocking some principal off the top, and giving people 30 years at ridiculously low interest rates to pay things off. They are BOTH taxpayer subsidies.
I wonder how they arrived at that number 20k? What's this going to save you, 200 a month? Chump change even if you have a job. Imo, this deal smells like a back door effort to save the banks ass. Probably a bank foreclosure procceeding is much more than 20k, banks have to cover state and local taxes, maintenance cripes legal fees are probably 20k per foreclusre and they are still lanlords of a vacant building. ----------------
Ron Paul,not because he's a great orator like obama,or that he would make a great prez,just for the fact that the Rep's are lying about who's leading the straw polls,who's winning the states,this tells me that they would be in real trouble if Paul gets any steam, that he's not part of the machine team nor will he join,for that reason alone,i will vote for him,,,in every state when you go to vote,just don't check any dem or rep boxes
What I don't understand is why the banks won't refi existing loans to longer terms to get the payment down. Take any loan and extend it out 40- to 50 years. They could do an ARM at 10 years - then 20 years or something like that. If the arguement is somehow the banks can't unwind the previous MBS, well it's done everyday to existing mortgages that pass underwriting, so what's the big deal? Can't we build a new house of cards, start another ponzi, the last one worked till it didn't...
i dont have any data but a mob guy i knew in the early 90's was taking signatures from anyone,mostly blacks in poorer neighborhoods,getting H U D loans approved , got him a check for avg 3k per house,most of the signatures failed by the 2nd or 3rd payment,some didnt have jobs,all he wanted was the signature and he had a guy inside who rubber stamped it,this is same thing times 100,it will get buried with where's jimmy hoffa,who killed kennedy,obama's nationality
So the bottomfeeders and losers who leveraged their way into a house they cant afford gets another reward while the average working joe who lives within his means and pays his mortgage on time will be the ones footing the bill. What a bunch of bullshit, how about giving 20k to the guys who makes <200k and always paid their mortgage on time for the last 5 years? If this is not socialism, what is?
The problem with the underwater homeowners is that they can't take advantage of these very low rates to refinance. Its not like they can't make the payment, so we are really talking about two distinct sets of borrowers...those that have stopped paying because they lost a job etc...and those that can pay but can't refi due to being underwater. (The strategic defaulters are another problem and should be dealt with separately). Throwing 20k may sound like a good idea, but this is a case of the cure being worse than the disease. #1 it really isn't going to help the vast majority underwater, and #2 it creates a very real moral hazard. A better idea would be to set up a "public-private bank" to help those uw, but willing and able to pay, refi their loans. Maybe they could set it up so the bank takes the risk early in the loan, but shares in any equity appreciation going forward. It could be set up similar to a bond and trade on an exchange. Once housing starts to recover, and it will, there could be a pretty healthy market for these to trade in. One reason the TARP worked out is that it gave players time to adjust to conditions. I think something like what I describe could so the same for housing.
Good points. The current buzz word is "creates a moral hazard". Imo, we are in the midst of a pervasive moral hazard from the top down. (Which began from the big players).Now all of a sudden Joe the Plumber might become a moral misfit and spoil the status quo? Is bankruptcy a moral hazard? A bailout? How about the middle class eat stone soup, is this a moral hazard?