Housing Rescue Plan: For Some or For All?

"There is a BIG difference between foreclosure due to greed in RE speculation, or living way above one's means, and foreclosure due to losing your job"

Really, Montrose?

Doesn't "living within one's means" mean to save for a rainy day?

In other threads, you state that we ought to return to the concept of thrift (with which I agree). How does this plan reward thrift? Suburbandude's post at 10.25 AM framed the issue exactly right.

I am totally opposed to any plan that dis-incentivizes thrift, which is what this country needs to get back to. I am tired of seeing the concept of personal responsibility trashed by our governments.

Finally, regarding a sudden job loss, MM: don't we already have unemployment insurance? Where does nanny state stop? When does personal responsibility take over?

Posted by: benson at February 13, 2009 10:47 AM

CWB;

I take exception to your post. I am sorry for what happened to your folks, but that does not give you the right to imply that anyone who disagrees with this plan as some type of heartless fool, and drop the F-bomb on us. We live in a democracy, you know, and you need to respect that people of good will can have a different opinion.

MM and Just Wondering;

You are completely incorrect in implying that the foreclosure crisis is related to unemployment. The sub-prime mortgage crisis started in the summer of 2007,WELL BEFORE the current economic slump. In the summer of 2007, the unemployment rate was hovering around 5%.

The simple fact of the matter is that many folks bit off more than they could chew. I would submit to you that for many of these folks, foreclosure is actually the best option. What mercy is there in trying to keep folks in a home which will continue to be a burden on their shoulders? Studies have shown that many folks who are given relief on mortgages eventually do foreclose anyway, due to poor habits of thrift, unsteady incomes, etc.

Posted by: benson at February 13, 2009 11:03 AM

"We have to stop fetishing home ownership. If you can't afford your home/your mortgage -- a liability - you need to sell. I don't care why. Job loss, medical, dumb moves. It doesn't matter. If you can't afford it today, you won't be able to afford it next year either. This economy isn't going to turn around that quickly. Sell. Pay off your credit cards. Move on. The question, "How can we help them keep their home?" is not the right question. How can we get them back on their feet? That's the real question and the answer is to sell their home."

Ringo;

Excellent!!! This deserves "Quote of the Month", IMHO.

Posted by: benson at February 13, 2009 11:17 AM

CWB;

It seems to me that you are more interested in establishing your superior moral credentials, rather than debate the issue.

As such, I have nothing further to say to you on this matter except this: don't put words in my mouth.

Posted by: benson at February 13, 2009 11:19 AM

CWB;

OK, thanks. All cool.

Bxgrl;

I'll readily grant that Bush over-emphasized homeownership, though I would argue that he was not alone on that. Talking about the cause of the problem, however, does not point to the solution. I still think that Ringo hit the nail right on the head. The issue should not be framed as keeping folks in their home - a liability- but on getting them back on their feet. For many of these folks, selling a house they could never really afford IS the solution. It is exactly akin to paying off their credit card bills - another liability.

I'll take Ringo's statement a step further. This country would be alot better off if owning a home is seen for what it is: a form of consumption, rather than an "investment". The decision to won or rent a home is exactly analogous to that of buying or leasing a car.

Posted by: benson at February 13, 2009 11:37 AM

Just Wondering;

So by that logic, the early 1980's, when unemployment was over 10%, should have been a period of massive foreclosures. In fact, however, there was no foreclosure crisis back then.

Back then, of course, the national savings rate was much higher. Perhaps back then, folks did save for a rainy day, and lived within their means.

Posted by: benson at February 13, 2009 11:44 AM

Bxgrl;

I could agree with the idea of allowing these folks a rent-to-own option. I do agree that many of these folks were snookered, and some way should be found to get them back on their feet. My main point is that it should it not be done at the expense of -once again- destroying the concept of thrift.

Well, now that we've reached agreement on that, and Snark agrees with me above, I think some "Kumbaya" sing-long is called for.

Posted by: benson at February 13, 2009 11:52 AM