Housing Rescue Plan: For Some or For All?
Vague reports about the Obama administration’s plan in the works to help people in danger of losing their houses are starting to surface. Whether it ends up with the government subsidizing monthly payments or modifying the loans themselves, the big question, it seems to us, is whether the ultimate solution should address only those in…
Vague reports about the Obama administration’s plan in the works to help people in danger of losing their houses are starting to surface. Whether it ends up with the government subsidizing monthly payments or modifying the loans themselves, the big question, it seems to us, is whether the ultimate solution should address only those in immediate trouble or be an across-the-board relief measure. On the one hand, even if you’ve been playing by the rules and aren’t directly benefiting from a homeowner bailout, it’s still in the interest of your own property value to see fewer foreclosures and empty houses in your neighborhood; on the other hand, why should only the irresponsible and the unlucky get hand-outs? Tough stuff.
Anything that requires investigating a paper trail is nuts. The government doesn’t know how to do that.
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.
Sellers need buyers and that’s why we need a mortgage plan for credit-worthy people. The best possible solution would be to get back to the olden days when people might own a home and own one rental property as a nest egg. And other people rent until they can afford a home. Really afford a home.
The foreclosure crisis started with the rollover of adjustable rate mortgages of which many people did not understand what the hell they were getting into.
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.
“To the clueless the is a subsidy for Bankers!”
Point blank.
***Bid half off peak comps***
Lets make rent and credit card interest deductible if we’re going to throw money at homeowners…
Is that enough gasoline
Until we see the economy as a holistic entiry I wonder how we will eer fix the problem. I don’t beleive in subsidizing irresponsibility but how would we ever be able to know who was a financial idiot and who just fell on bad times due to the economy? That’s asking us to bemindreaders.
I’m sure there are indicators that could be looked at but I don’t think we have a chance at all if we get bogged down in trying to microcontrol everything at this point. Right now all we have is a bunch of rotten choices and in all honesty if some undeserving sod gets money to stay in the house he can’t afford, I’m all for it if it means 20 deserving families get to keep their homes too.
“Since there is no way to really figure that out I don’t think they can do it.”
Of course there is. As Montrose explains, there’s normally a paper trail.
The person with high credit card debt, leasing a BMW, going to Vegas but not paying his mortgage is easily found out. So are the real estate speculators who purchased four or five homes with no money down by working with shady mortgage brokers who helped them doctor their paper work to qualify for the mortgages. This all shows up on their credit reports and on their bank statements. I can say it’s been my experience that the speculators out number the BMW driving, Vegas going, 25K in credit card debt having, non-mortgage paying folks. But the people who lost jobs are the vast majority of the people who are in trouble.
People taking potshots at Obama are fools … we just let the worst president in US history bend our country over a stool for eight years. If you think the damage can be fixed in a month, you’re crazy.
I don’t think Obama’s a savior from the heavens — in fact, I am highly skeptical that he’ll be able to enact any real change in a country that’s been essentially stalled for the last 40 years, but to be like “welp, the economy still sucks. Fail!” after a month is insane.
Additionally, I just watched my own parents lose their primary source of income, have to settle for a new income that’s 40% lower, and have to sell the house that my entire family grew up in so as to avoid foreclosure. So forgive me (and my language) if I extend a big “fuck you” to everyone who’s advocating sitting back and allowing blanket failure as some kind of solution.
That’s not the right way to treat other human beings. Even if in the process of trying to help those who deserve it, you end up helping some who don’t, it’s still better to do something.