Bush's new âStimulus Package will allow Fannie and Freddie to raise their loan limits from $417,000 to $729,750.The idea is to keep interest rates as low as possible on new mortgages in order to revive the moribund California and New York housing markets. Jumbo loansâmortgages that are over $417, 000â-are nearly impossible to get now that the market for mortgage-backed securities (MBS) has dried up and the banks have tightened up their lending standards. Sales in California have dropped 40% or more for the last 4 months. Price declines are in double digits. It is a housing Depression. Still, there's no guarantee that the plan will work. After all, Fannie Mae requires a substantial down payment as well as documentation of earnings and a good credit record. The whole lending environment has changed dramatically in the last year. It's gotten a lot tougher and the pool of potential loan applicants has shrunk considerably. Besides, how many people are going to plunk down $700,000 for a home in a falling market? That same MacMansion might dip to $625,000 by the end of the year. No one wants to take a bath like that. More importantly, why should taxpayers have to guarantee a $700,000 loan just so some brandy-swindling tycoon can get a better deal on his mortgage? That's nut ________________________________________
This is fucking idiotic. I hate BUSH for this more than the war in Iraq. Fuck! What I want to see is Fannie Mae and Freddie Mac only be allowed to buy 15 or 30 year fixed-rate mortgages only. As long as the Loan-to-Value is at 80% or less than, maybe then the limits can be increased. I'd also like to see only 15 and 30 year FIXED rate mortgages qualify for the mortgage interest tax deduction. No tax deductions on interest-only mortgages. This is probably the single biggest reason California and South Florida grew into such large bubbles. Throw in ARMs too just to force people into buying homes they cannot afford. I'd also like to see the tax deduction on property taxes removed. Local governments are too fucking greedy, and maybe people will get more involved in government at the local level once they get tired of taking it up the ass. But to offset I'd like to see a tax credit in the amount of up to say $1000 to cover the cost of property insurance. This will help responsible people afford rea homes.
My policies would destroy the economy, but it will regrow responsible. I say it's better to do the hard work now than to wait until the problem get bigger.
What everyone needs to realize is that these actions in reality have nothing to do with keeping people in their homes out of the goodness of their hearts. This is transpiring because the assetts have greatly diminished in value and the banks cannot and do not want to foreclose and take these massive losses. In fact, without this freeze and restructure, these banks will be out of business and that is why the gubmint is trying to "keep Americans in their homes" Wake up and smell the sewer gas folks, if you're underwater in your home, fuck the bank that fucked you and WALK! You can recoup by shorting the market!!!
And while I am on a rant, everyone that is underwater in debt should all collectively stop paying anything. Let the financial system collapse, it will happen sooner than later anyway. Get ready for capitalism 2.0 to emerge from the ashes.
Fannie & Freddy guidelines are for 15/30 yr 80% LTV or less loans anyways...at least they used to be.....when the loans are higher, PMI is required to insure the excess over 80%..
I agree with you.Since we are still capable to work or even change our future,so it's always better to crash now rather to crash later.
Good word,I've never thought this method before. The best way to end this absurd phenomenon is stop paying any debt and make the system meltdown.The modern financial system is essentially insane and it should be stopped and rebuilt.
I believe new capitalism could find its own way,not current one.Today's economy is unsustainable and poses great threat to global monetary system.