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bailing the struggling homeowners by putting them in to a fixed mortgage for them to pay would affect us homeowners not involved in this mess the MOST, along with our gvt, who now owns all of the foreclosed homes....we need the housing market to IMPROVE so that the gvt gets our money BACK when they sell the assets they just bought or nationalized!
the dems are absolutely RIGHT in insisting on this! in fact, they should have done this LONG ago, then the banks/insurance companies wouldn't have needed the major bailouts they're getting now....
nooooooooooo oreo, they were refused conventional mortgages by the banks when the time came to refinance their adjustable mortgages....HELLO--LOWER fixed mortgage rates have been available forever to people struggling. Most walked on the house instead of refinancing to a lower fixed rate
Think about it? If you don't have to put any money down on a home, or offer up any collateral--the home you just bought is more like a rental home you can no longer afford to stay in. It's very easy to walk out. That's what has happened.
I'm a realtor. I know a hell of a lot about mortgages.
The problem came in 2000 when Phil Gramm changed the laws and that took the risk out of risky lending. The mortgage companies would lend money to bad credit people and then sell the mortgage the day after closing. There was no risk to them at all. I was fortunate enough to only have one client who fit this description. He used a mortgage company that I knew was a ripoff, and I warned him not to use them, but he used them anyway. When we got to the closing, the lawyer told me the guy had two 40 year mortgages. I was floored! If he had discussed this with me, I would have told him to rent instead.
bailing the struggling homeowners by putting them in to a fixed mortgage for them to pay would affect us homeowners not involved in this mess the MOST, along with our gvt, who now owns all of the foreclosed homes....we need the housing market to IMPROVE so that the gvt gets our money BACK when they sell the assets they just bought or nationalized!
the dems are absolutely RIGHT in insisting on this! in fact, they should have done this LONG ago, then the banks/insurance companies wouldn't have needed the major bailouts they're getting now....
How about we just have the Demos and their swindlers that lined their pockets with the cash, pay back the money and then garnish their wages for the next century? Sounds like a plan to me. Why should I have to pay for this crap while they get away with FRAUD and live in mansions?
How about we just have the Demos and their swindlers that lined their pockets with the cash, pay back the money and then garnish their wages for the next century? Sounds like a plan to me. Why should I have to pay for this crap while they get away with FRAUD and live in mansions?
nooooooooooo oreo, they were refused conventional mortgages by the banks when the time came to refinance their adjustable mortgages....
What a crock of shit.
The Republicans created the crisis, and they walked away with the money.
this is when the pyramid scam of the banks and financial institutions fell like humpty dumpty...when mortgages were not avail to the adjustables....
as long as the adjustables were fixed and not adjusting upwards and as long as conventionals were avail to them for refinancing, nothing was wrong with the housing market.
but once the conventionals were not avail to them people started to default on their loans, which put more homes on to the market, which increased supply which then lowered the value of homes, which then made it even harder to refinance in to a conventional because they had no equity in their home which was needed to get the conventional, which then made the situation worse because more and more homes were being foreclosed which then lead the market for homes down even further, with the supply now much much more than demand, which then lead in to even lower drops in housing prices, which then made it even HARDER to refi in to a conventional because they held UPSIDE DOWN mortgages....they owed more than their houses were now WORTH in the market place, thus now making it IMPOSSIBLE to refi in to a conventional loan.
the pyramid fell.
it worked great when home prices were going up....
That's the point. Many of these people believed that mortgage rates would drop, or that the value of their homes would raise. You know, I think one would make a better bet in Las Vegas. Mortgage rates always go up & down. Why were'nt these people qualified at the HIGH end of the ARM or whatever mortgage they were buying? Where was the oversight, were were the underwriters in all of this?
Also, how many of these homes where bought by the flip & sell investors. I can't believe that "flip that house" is still a program on T.V. Buy it, paint it & sell for a huge profit 1 month later.
The housing crash came on us like the tech crash. No one bailed out millions of Americans who got slaughtered in that.
when my husband and I took out our first mortgage together we had to supply PROOF of our income, PROOF of all debt, PROOF of all assets, and a number of other things in order to qualify for a mortgage...whatever stopped the banks from continuing such sound business practice is BEYOND ME other than what you;ve been saying, the selling off of debt or these mortgages the minute they suckered the homeowner in to the subprime mortgage was what helped keep the whole ruse going....
Let me ask you something? do you think these banks held a gun to these peoples head and said sign this mortgage or else? The bottom line is this , if someone does not have the ability to pay their mortgage their house gets foreclosed, if a bank makes bad loans they are SUPPOSED to go out of business if they make too many of them. It's actually quote simple, when your bank asked you for proof of income they were making sure that your income, was enough for the house you were purchasing, however, you as the homeowner knew or at least I hope you knew, that if you made 25,000.00 a year, a 750,000.00 home was a bit out of your price range. If someone is buying a home and they make only so much money and the bank say's here is your home loan it's a 3 year ARM at 1% then on the 4th year it goes up to 9 1/2 %, You mean the poor the people taking those loans out have no responsibility whatsoever? I cannot believe how democrats cannot see that by bailing out bad mortgages and people that are behind on their mortgages send a bad message to those that have been paying it all along. It's rather like, not only have I been making my payment on time, now I have pay theirs too. Make NO MISTAKE, the only WAY to pay for this huge bail out is to raise taxes.
Wonderful point Navy, The only way people were put into loans they couldnt afford is if they or the broker was committing fraud. This mostly happened on stated loans and when Joe the self employed consumer who owns a lawn mowing business either said he makes 10k a month or the broker just filled in the application and made the income up for them they are both at fault because you need a signed 1003(loan application) with the stated income on it so the consumers were committing fraud as well by signing these documents. Its amazing how people who have owned multiple houses in their lifetime can play dumb and take no responsibility.
is the government actually going to own these homes, or are they just giving money away without obtaining ownership rights?The point of this thread is: We already know we're going to be bailing out the banks--at a cost of 700 billion dollars. In essense, our government will own these foreclosed homes.
I'm a realtor. I know a hell of a lot about mortgages.
The problem came in 2000 when Phil Gramm changed the laws and that took the risk out of risky lending. The mortgage companies would lend money to bad credit people and then sell the mortgage the day after closing. There was no risk to them at all. I was fortunate enough to only have one client who fit this description. He used a mortgage company that I knew was a ripoff, and I warned him not to use them, but he used them anyway. When we got to the closing, the lawyer told me the guy had two 40 year mortgages. I was floored! If he had discussed this with me, I would have told him to rent instead.
Smoke screening
September 19, 2008 ...
Were only beginning to face the problems exposed by the failures of giant financial institutions such FreddieMac, FannieMae, Bear Stearns and AIG and government bail-outs backed by the continuing ability to borrow from China and other creditor nations. Of which we used to be the biggest. Quite the opposite now.
If youre looking for a far-sighted bubble-burster, Kevin Phillips is your man. He launched his career as a Senior Strategist for Richard Nixons 1968 presidential campaign. There he led Nixons successful southern strategy and followed that with The Emerging Republican Majority in 1969. In that book he not only predicted forty years of future, but named the Sun Belt as well. His latest book is Bad Money: Reckless Finance, Failed Politics, and the Global Crisis of American Capitalism, which Tim Rutten in the LA Times calls a rhetorical shot across the bow of the current presidential campaign, which Phillips convincingly argues is failing to address the causes and implications of our current distress.
Here he is on Chris Lydons Open Source program, on May 8 of this year:
Theres a growing sense in the United States that the Imperial Era is over almost before it started. Were seeing the weakness that is the United States allowing the financial sector to take over the private economy. That is now the largest portion: 21-22% of the GDP is finance, pushing manufacturing way down. I dont think that the financial sector is responsible enough, safe enough, broad-minded enough to fill that position. I think what youll see happen to the United States is over-financialization: too much debt, too much over expansion and a degree of an implosion that will involve everything from too much debt and collapsing home prices to rising oil prices and the declining dollar. Its all converging. Its all trouble. It doesnt spell the end of the United States, but it does spell the end of the United States as the Total Big Cheeze in the world. And we are going to lose some of the yardsticks that everybody enjoyed for a long time.
About financialization, he says,
Youre looking at the transformation of the American economy from one that produced things to one that moves money around. But it didnt happen overnight. One of the major relationships is between the rise of debt and the rise of the debt culture. The debt culture meant rising deficits and spend now and play and pay later, the publics debt tolerance to an extraordinary degree, and this general lackidasicalness of putting a framework around your culture and your economy theyve all sort of gone to seed together. And I think that the net outcome of this is a country that is in every way living beyond its means. We used to be the leading world creditor, the leading world manufacturer and the leading world producer of oil. Now were the worlds leading debtor, the largest inporter of manufatures and the worlds leading importer of oil. Its a disastrous transformation. The only part of the economy that has profited is the financial sector, because an awful lot of the transition is toward more debt, more credit, more living on things you cant afford, more keeping up pretenses, and more ambition around the world with less to back it up. And the consequenses of this in many ways is the George W. Bush administration.
Not that Phillips thinks the Democrats are any better. About Paul Krugman, for example, he says,
There is a good reason for Paul and the Democrats in general to be upbeat here. Maybe to an extent if things were a lot further advanced in the decay process, you could just flip a leaf and say all of a sudden that we are ferociously concerned about this decay. But they think that liberal policies and the Democratic approach can turn it around. Frankly, I dont The Democratic magic is more of the old razmatazz, and government will step in and theres going to be a Green Deal as well as a New Deal, and were going to have five million new jobs for things relating to the Greening of America The Democrats dont want to admit that what they di8d for the most part in the two Clinton administrations was for the most part a continuation of the Reagan and first Bush administration and then was continued and built upon by the second Bush administration. You had a lot of financial deregulation under the Clinton administrations. They repealed Glass-Stiegel, they deregulated credit cards, lots of stuff. They stepped on the gas in terms of private debt. The increase is extraordinary. So I cant separate out the Clinton years from what preceded them and what came after them. And of course the Democrats need to be able to tell America in this election that they have the answer. I understand that. But I dont agree with it.
As for Obama, he says I dont think hes raised enough of these issues to have a mandate Theyre not acting now like people who understand that theres a problem.
He also adds, That clearly goes for the Republicans. Its hard to believe McCain. His economic program is almost a non-program. Thats on top of George W. Bush: I dont want to do another number on George W. after American Dynasty, but hes the wrong person at the wrong time andin the wrong place and unqualified essentially for having been president of the United States during these eight years.
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