From CNN's Jack Cafferty:
Home foreclosures were up a record 81% in 2008…that's a 225% increase since 2006. If that doesn't get your attention how about this: more than 3 million foreclosure filings were issued last year and more than 860 thousand families lost their homes.
Should the government be doing anything to help homeowners?
Some say that number is on the low side, and this year things may get worse. Efforts to stop or even slow the crisis have failed. The two government- sponsored mortgage companies, Fannie Mae and Freddie Mac, temporarily suspended foreclosures at the end of November. But foreclosures in December were higher than in November. The experts are now predicting we could see another 3 million foreclosures this year.
The rest of the problem is tied to collapsing prices. The S&P/Case-Shiller Home Price Index says home prices have dropped 21% on average nationally from their peak, and in some of the worst hit areas, like Phoenix, they've dropped as much as 40%. What this means in many cases is that people who can no longer make their mortgage payments also cannot sell their house for enough to pay off their mortgage. The houses are worth less than what is owed on them.
Here’s my question to you: What should the government be doing, if anything, to help homeowners?
Interested to know which ones made it on air?
Dina from Ashland, Virginia writes:
Right now, my husband and I are working, so we can pay our mortgage. But who knows what the future holds? I'd like the government to mandate that mortgage companies be more flexible when homeowners have to deal with the unexpected like unemployment, death of a spouse, and illness. The first course of action should not be foreclosure.
Barbara from North Carolina writes:
Why should we all have to pay for the mistakes those homeowners made? Some of us rent, we get hit with the taxes and the ones who made mistakes get our money. Where's my payment for not going in over my head?
Ron from San Diego, California writes:
Hi Jack: Instead of giving the money to the banks. The federal government should offer refinancing directly. A direct loan program for distressed homeowners at a low fixed rate. That way their payments would be a lot lower. In addition, they would not be in danger of losing their house.
Barry from Granger, Indiana writes:
As a realtor that works with people going into foreclosure in Northern Indiana, the big need is for job creation right now. Elkhart County has an unemployment rate of 12.4% due to lack of manufacturing jobs right now. Other than jobs, I would like to see a loan modification system that makes sense for owner occupants, not for the person whose summer beach house is in foreclosure. The banks need a clear system. Most everybody I come in contact with that is in foreclosure tells me that the bank will not work with them.
Linda from Charleston, South Carolina writes:
Mandatory refinancing of ARM mortgages that should not have happened in the first place.
Jack, Why not give each eligible voting Americans $250,000. Tax them on it. Create a mandatory mortgage payoff and purchase of an American automobile. Instant stimulus package. Why give more money to people who screwed it up the first time?
Absolutely nothing. The worst thing the government can do is keep home values artificially high. Price fixing is illegal.
All the money they want to give away to help CEO's who failed our financial system should be used to cover the morgages of the home owners in default. Give them a new loan with extended payments that they can afford. No mater what their home will not ever be worth what they originally paid, at least for another 50 years.
In a real democracy, the federal government would have used the taxpayers bailout money to help, try and follow me here, the taxpayers. $700B is more than enough to put every single family that got foreclosed back into their homes. Then people would have more money to spend. Economy fixed.
The rest of Tarp should be allocated to homeowners, taxpayers, and small businesses. Not one additional dime should go to corporations, banks, and big contributors ( I mean big business).
Wildwood Crest, NJ
what can they do really? just remember what the government does it will cost at least 10 times what it should.
Homeowners are hurting, but I still have not heard of a way that will get the money to the right people. This last bailout to the banks was supposed to free up money to help them and all we've seen is the banks sitting on that money like an old sitting hen. If they didn't sit on it, they used it to buy up other banks and make themselves bigger. Bigger is not always better.
Truthfully, Jack, I am disgusted with our banking system. Banks have taken white collar crime to a new high.
So many of the people losing their homes should not have been given the loans to begin with. A case-by-case analogy would be impossible. Let’s save social security, keep education a priority and support government jobs that repair our infrastructure. Owning a home is not as important as having a job.
I assume you mean those homeowners who knew or should have known that they were buying a house they couldn’t afford. The government should take their house away from them and give them mine. Mine is much more modest than theirs and probably more in line with what they can afford. Then they should give me their house as a reward for trying to do it the honest way by only buying stuff I can pay for. Then the government should make the banks and lenders forgive the unreasonable part of the mortgage they gave to people knowing they couldn’t pay it back. Sounds fair to me.
1)Teach the ones that made $14.00/hour and took out $350,000 mortgages remedial math.
2) Teach aforementioned people how to read contracts. Especially ones that involve a change in interest rate and another crazy thing called a time frame.
3) Seize the defaulted properties of said people, sell them to whoever will buy them, and use the money to help home owners who could pay their mortgages but are now suffrering due to this crisis.
Don't even get me started on the banks
Government should help home owners for any uneducated person will tell you that with less persons on the streets, it is less pressure on the economy.
The government should buy off the mortgages directly from the owners, and have them to repay the loans back at about 3.5% interest, for why give the banks money when they are just as guilty of the financial problems we face today as the business owners who were unscrupulous in their dealings.
There is one main problem that is not being addressed. A lot of home owners are upside down on their mortgage. If these millions of Americans are not helped than the recovery will be much slower.
Rancho Cordova, CA
I heard of people who are buying a new home and renting their foeclosed on home to other family or friends as the foreclosure becomes finalized. In other words they are making money on the home they left by renting it out without paying the mortgage and buying the new under the girlfriends or boyfriends name. If this is true and I believe it is we are going to shovel more money at people like these people. What about the guy who is still struggling to keep their house by working it out. What incentive will he have to keep struggling why not take the handout and foreclose?
The government should do absolutely nothing for those who bought homes they could not afford. If there are homeowners out there caught in a situation over which they had no control, such a job loss or health problems, then help should be available to them.
Jack, since we are now the lenders to the banks and mortgage companies I would like to inform them that they have two choices, they can apply our mortgages to their loan amount as a write down, or pay back their loan with a much higher interest rate because their credit scores are lower, since they cannot seem to budget wisely. So they can write off our mortgages and we will all be happy, less money for them to pay back and trust me without that high mortgage payment we can use that money to stimulate the economy and save!
It should buy the mortgages and drop the rate to three percent. That will halt our free fall into depression and stabilize a segment of the economy. The UN can tell you all the downsides of homeless refugees.
Instead of giving wall street unbridled reign over our money, give the
money to the homeowners and allow us to bail our own selves out.
That way we won't be paying the crooks twice: once with the bailout
money and the second time with them still trying to collect the debt
from the homeowners also.
Its our only hope Jack.
This is a hard one. It would be ideal if the government could buy up foreclosures and renegotiate with the present owners a fixed rate that would allow them to remain in their homes and finish paying it off,even if over a longer time than originally intended.
Lets start from the beginning– pay off all mortgages for the middle class..lets start with a clean sweep
They best way to put out a fire is to take away the fuel. That means not just buying up bad credit, but by restricting the means for people to get themselves into bad credit situations. Raise the standard for people to get loans (for everyone!) and make it clear that Nanny Government is not going to bail lenders or borrowers out for their own stupidity or recklessness. The motto for financial institutions should be "lend (or borrow) at your own risk."
I think the homeowners that need it most have already lost their homes, but with oversight and penalties for abusing funds, people presently losing their homes should get a government loan to pay the mortgage and then pay the government, much like the student loans work. The government works with the people to get them to pay the loans and I see no reason why it couldn't be done with mortgages.
Why should we ALL have to pay for the mistakes those "homeowners" made? Some of us rent, we get hit with the taxes and the ones who made mistakes get our money. Where's my payment for NOT going in over my head? Only penalties?
I heard a report on CNN's "Your Money" where one of Ali Velshi's guests reported that it would cost the govenment $250 billion to buy every mortgage that is currently in default. that sure sounds a lot more productive than giving TRILLIONS to the Wall Street corporate criminals that got us into the current economic mess in the first place.
How about bailing them out. What's the sense of helping out the banks if there are no more homeowners to get mortages from? It seems to me that the very people that voiced loud and clear for change now cannot be heard when crying for help.
Instead of giving the money to the banks. The federal government should offer refinancing directly. A direct loan program for distressed homeowners. At a low fixed rate. That way their paynments would be allot lower. In addition, they would not be in danger of losing their house.
Ron San Diego
As a veteran real estate broker of integrity, I have witnessed and been dismayed by some of the loan shenanigans and have steered my clients clear of them when possible. The government needs to insist that banks rewrite and convert adjustable loans to fixed rate lower interest loans for whoever wants them. The government could pay the lenders a set fee, such as $2000 per transaction, so that homeowners don't have to come up with extra funds. Loan balance amounts should remain the same so that an advantage over neighbors is not created. Most everyone's property has been devalued, but that will right itself naturally over time. If Greenspan had not raised interest rates 16 times in a row before retiring, the adjustments would not have been so disasterous. Since the government contributed greatly to the problem, they have an obligation to clean up the mess.
Jack, it would be far cheaper if they would pay off my mortgage and and everyone elses as opposed to the 300 billion or more dollars that our president and congress threw away by giving it to banks. Bush's efforts to push congress into approving his wasteful bailout is pretty much the final nail in the coffin of the US economy. All of his policies have been geared towards benefiting the rich and wealthy at the expense of the middle class. If the governent really honestly wants to help homeowners they need to put the money directly in the hands of the homeowners instead of the greedy self serving banks.
What I personally would like to see is a moritorium on foreclosures, as long as the homeowners are making payments amounting to at least 2/3rds of each month's mortgage until the economy stablizes. Then, allow them to make up the amount due in reasonable amounts, or to refinance, or to sell in a better housing market.
Also, do not dump renters on the street, like reported happened in Chicago, when the building owner does not make their payments. If the renter has receipts for the payments made, they should be allowed to remain, and pay their rent to the bank or financing agency for the length of their lease, or for 6 months, which ever is less - that will allow them time to find a new place to live.
Have the stimulus go directly where it is needed rather to where it is not needed. It is not needed by banks to secure the mergers of other banks. This does not adequately ease the credit problem. Paulson was supposed to buy up bad assets but he changed his mind and simply gave it away to banks to bolster their bottom lines. When banks buy up other banks, mergers require more time to eliminate workers doing the same jobs. It requires time to get the respective ledgers of both back into operating order. Essentially, it doesn't speed up the thawing of the credit market as much as the money going to directly where it is needed and not to where it won't do very much good!
First of all I think there should be a plan that would allow them to make payments on their homes that people would be able to afford. If homeowners are thrown out of their homes be cause they cannot make the payments, they also are thrown out of a home that banks cannot sell.
First, quit feeding the empty promises of bailouts. Then, work on putting the American people back to work. This can be done both by creating new jobs, and cutting back on work visas issued for foreign workers. If people have a job, then they can pay a mortgage. Giving jobs away to foreigners does not help the American worker at all.
The government should be doing more than just throwing money at the banks expecting them to help beleaguered home buyers. Obviously, some sort of direct intervention is called for.
It's simple. Every bank should be ordered to adjust their mortgages to a given percentage of income. They have the TARP money to make up the shortfalls in the near future (the land and the house isn't going anywhere) and will have structure to make the changes for the future. Take the guess work out of things. If people knew they needed to be at the same job for 3 years, had 20% down and not exceed 50% of their income they and the banks would have a structure to plan around and the guess work would be gone. The government could force the banks to do that.
Nothing! The people who signed ARMs thinking they could get housing on the cheap and play the system by refinancing later when the rates adjust upward are getting what they deserve. Why bail out the speculators and not the responsible people who signed a fixed rate mortgage they knew they could afford? The government has already stepped in to bailout the irresponsible folks who crashed the unregulated financial sector. The ultimate question is: Why is loss socialized while profit is privatized?
The government should reduce the principle by 50% on all of the mortgages that are current, you know up to date. It is time to reward the people that are doing the right thing. You know if the government pays down the mortgages on the people that are current and have the banks recalculate the loans, the people will have that much more money to put into the failing economy. The people that are not current and cannot pay their mortgages due to lack of funds will not have extra money to spend no matter what the government does to help them. And has anyone noticed that the ARM's are now paying less in interest because the mortgage rates have gone down, and their mortgages now reset at a lower rate.
St. Augustine, Fl
The government needs to get off the pot and stop acting like they have no control over the institutions that created this mess . It's time to force all the banks to renegotiate these morgages . Period . No more forclosers should be allowed until this happens . Not one more cent of tax payers dollars should be given to these banks without full compliance .
First, quit feeding the empty promises of bailouts. Then, work on putting the American people back to work. This can be done both by creating new jobs, and cutting back on work visas issued for foreign workers. If people have a job, then they can pay a mortgage. Giving jobs away to foreigners does not help the American worker at all.
They shouldn't do anything. The problem is though, the government is on a dangerous slippery slope. They helped Wall Street and Detroit, but aren't going to help homeowners? Now they are so deep in, they might as well go all in unfortunately.
Yes Jack, I think the government should help homeowners and here's what they need to do: They need to give us each a million dollars so we can pay off our mortgages, our debts, and then whatever is left we can buy stuff and put money back into the economy. Heck, it would cost less than 350 billion to do it that way and start everyone off fresh. Besides, why not give it to the taxpayers since we're the ones that'll have to pay it back anyway.
For a limited time, the government should decrease the number of years that a foreclosure would remain on someone's credit . The government should not be involved financially in someone's bad debt, as this will not bring down the price of available homes. When the prices come down, people will buy, including those that lost their homes in the crisis. That way the market remains free and everyone has equal footing to invest in their futures.
I think the government should use part of the bailout money and figure out a way to give each American tax/voter $1m, me thinks this would give the economy a huge boost, rather than give Paulson & his croonies this huge check to do as they please, which they have already done. Me thinks the chickens have come home to roost.
"Homeowners" should mean owners occupying their homes, not those who invest and rent the properties to others, first of all.
Homeowners should be able to refinance with better terms if possible, but I don't agree with caps on property taxes. I have rented for years, and guess what? I do not get anything back when property tax payers get decreases–instead my state income tax goes way up, and that's in addition to not being able to deduct anything, as homeowners can.
the government could help homeowners by forcing housing insurance companies to stop over inflating costs. This would mean that the state agencies that audit home values would need to value homes at their actual values, not some grossly inflated number. The government could demand that insurance companies refund the amount that homeowners have been overpaying in this down turned economy where housing values have plummeted yet insurance costs have either risen or stayed the same. NO STIMULUS!!! STOP SPENDING MONEY!!!
Give them 100,000 each to pay of their mortgages instead of giving it to banks.
Jack: Credit is frozen, consumer purchasing power is in decline, in the last four months the country has lost 2 million jobs and we are expected to lose another 3 to 5 million in the next year. In the next two weeks, the Congress will be considering the American Recovery and Reinvestment Bill (ARR) of 2009 to the tune of $825 billion. What the government needs to do is allocate a portion of this funding and a portion of the remaing balance of the 700 billion dollar bailout to assist those homeowners in need. I saw nothing in the ARRB addressing homeowners. I guess when you look at the big picture, homeowners are a low priority.
Lets face it. A house is a house. The same components go into a house no matter where it is located. The prices on the coasts and in other metro places have been way out of whack and getting worse for years. The government should do something to even things out over the whole country and to help get things back into balance. That would be a beginning to make this country whole. Another good move would be to end credit cards (help people get out of the mercileess debt they create). Maybe keep debit cards and support saving. Keep the stock market for people who can afford to play and take risks.
There are several things the government can do to help homeowners. First of all there should be option to renegociate mortgages to lower rate mortgages. Government backed low-cost home improvement loans would also help. And finally, a rebate program for purchase of energy efficient appliances and home heating equipment including installation of green technologies.
Jack: The answer is, "President-elect Barack Obama should spend the remaining $350 billion of a financial bailout fund on expanded lending and reduced foreclosures and not use the money to help other industries.
What am I missing? Can't the Government loan 825 billion to banks and such with 500,000 checkbooks to force banks to show where every penny goes? Banks don't use checkbooks or ledgers?
Fire every CEO and bring criminal charges against every financial
person in the fianancial institutions involved in the scam and the misuse of our taxpayer dollars.
Replace them with people of integrity and answerable to how every
penny has been and will be spent.
Help can come in the form a decent fixed interest from the lender. How is that we bail out banks and they don't anything to help homeowners? Government can help homeowners( Of course, this would come from us, the taxpayers), but from my point of view, banks and other lenders should do much more to help the economy get back on track.
of course, they helped the banks and financial companies with that bailout that no one will explain or hold accountable to the taxpapayers. the least they can do is NOW help some homeowners as they led us to believe the bailout would do. It would be a refreshing change to see them help the middle class little guy who is losing his only home.
Jack, ultimately the government should not “rescue” someone that made an ill advised choice or someone who tried to make a killing in the housing market, only to be left bankrupt. If the government wants to offer assistance to someone in the form of converting an out of control ARM into a fixed rate mortgage, then that’s fine. Other than that, whatever happened to “You made your bed, now you get to lie in it”?
One way to jumpstart the economy is to allow all homeowners to refinance at 3.5% -4.5% and leave the lower rates in place for at least six months. That will encourage people who want to buy to make their decisions. It isn't enough to allow only those who cannot pay ontime to reap the benefits. Homeowners who pay ontime should also be allowed to refinance. If those in default get to lower their principal to meet current valuations, the next door neighbor should have the same benefit. Foreclosures and lower valuations affect all in the neighborhood.
Make home property taxes paid a tax credit rather than deduction;this would help the middle class and the elderly home owner more than all the other proposals;;
After watching cnn about how the how habitat for humanity has the least amount of forecloseures with the lowest income clients, seems to me we ought ta let them slow uneducated folk handle the rest of the money since they can to so much with so little. Could it be because they are not in it for selfishness and greed, but to actually lift each neighbor into success?
How about putting a cap on interest rates. Get rid of variable rates and fix it at one specific rate. Then no homeowner will have a surprise when the variable rate runs out and they are hit with a huge interest rate.
The government needs to put a stop on all foreclosures for a period of time–say six months to a year. Then, Congress or someone reliable who will be accountable, needs to look at where all the money is going that was supposed to help people in the first round of spending. I don't think that money helped anyone but the bankers–all Paulsen's friends. Second, Congress needs to spend money to fix the foreclosure mess, and take a look at the companies that got us into this and either close them down or put them under reliable management. There needs to be some tight regulations on the mortgage market, and someone who knows this area, needs to set the laws, so this doesn't happen again.
They can help by insisting the banks allocate a portion of the bail-out money to help homeowners stay in their homes. Severe penalties should be assessed to those institutions not in compliance, and the funny loans should be refinanced at more affordable fixed rates. I wonder if the IRS were involved in compliance, things would change more quickly.
What they should do is order banks and homeowners to sit down
to renegotiate their mortgages. The banks foreclose and end up with
houses nobody wants. The banks always lose money on a foreclosure. It's better to keep the homeowner in the house and work
out a payment plan that works. It's a win-win situation. Of course, it
won't work for everyone but the banks and loan companies need to
at least try. It's better to renegotiate than to lose everything. The problem with everyone is they have no common sense just a bunch
of rules that don't work for anybody.
Want to help homeowners? Pay off all the mortgages in this country for people earning less than $250,000, regardless of loan status. If the government can give money to the rich and not require repayment, it's only fair they do the same for the rest of us. Then go back to Wall Street and the fat cats and force them to play by the same rules that Congress expects the middle class and poor to play by. Tax the hell out of those companies to repay us for this economic mess we're in. For a start, I suggest a 75% income tax without any allowable deductions on those executives who received their golden parachutes and held parties with taxpayers' money. Make an example out of AIG. Right now AIG is the poster company of how their executives pulled another fast one on Congress. As a result Congress has decided that someone must be punished and we all know who that is - the middle class and poor.
This has to be dealt with on an individual basis. Should the homeowner who knew up front when he secured his mortgage that he would be way over his head and would not be able to pay his loan get help ? Help should go to the people who lost their jobs and cant pay their mortgage.
No handout to people who made bad, or inflated investments that could never be paid for by the buyer, and were just deals to let the sellers make a hugh profit. . Let it go to the people who have been trying to pay for their homes, but now because of the downturn they are getting behind, but they will be able to pay once things get a little better. The bad deals will remain bad deals, and no money should be used to cover them.
There should be offices set up all over the country with trained HUD employees whose job is to arrange to buy up the lost value in buyers' mortgages since this crisis began, and an aggressive advertising campaign to alert homeowners to its existence.
Some moralists with sphincter issues are worried that undeserving slackers and unethical investors will take advantage of this offer. I figure the past and continuing unethical behavior of banks, mortgage issuers and wall street crooks far outweighs that of those slackers and investors. Let's make homeowners as whole as we're making the banks and start fresh with sane mortgage laws.
Have the banks stop using the bailout money to buy other banks and use it for what it was intended to be used for – helping the homeowners with their monthly payments. Make them accountable for all the money us taxpayers have given them to date and not accept the notion that they do not have to disclose where it all went.
Just give everyone who has been making there payments on time there house! Than use all the money you save on your house payment to pay off credit card dept. It is a win win for all!
The government is giving away $700 billion to the financial industry, automotive industry, maybe the porn industry and any one else who applies for it. The economy will not improve until Americans start spending again and as long as the current situation exists, that is not going to happen regardless of how much money industry gets. The best example is cars; the government can give them billions upon billions, but until the consumer has the means and the comfort level, they are not going to buy.
So how about thinking outside the box (for the government anyway) and give the money directly to the people who will spend it. Trust me, if the consumers have it, it will be spent. Think of the possibilities.....foreclosures would drop, retail would improve, factories would have to hire to produce the products that are being sold, yada, yada, yada.
Between the two packages, we're looking at a cost of $1.5 to $2 trillion of which the consumer get $0. If that money goes to the consumer it gets pumped back into the economy. Simple way to look at it and a simple fix.
It makes me sad, but we shouldn't. I knew how much I could afford when I bought a house. I bought a little fixer-upper that did not cost a lot, because I don't make a lot. So I live in my sweet little ramshackle place that I can afford, while they take my money to pay for somebody who' living in a luxurious house they can't afford, just because they got approved? I don't want to have to pay for their recklessness-They wouldn't pay for mine. It's called 'being responsible'. Look it up. It may open your eyes
The government shouldn't be helping homeowners that bought homes that cost 'more than they could afford' and didn't have any money for a down payment. Sorry – loss the house and learn a lesson. It is called being responsible for your adult decisions. As for those that cry – the bank didn't explain it to me. Guess what folks – when you are borrowing money to buy something that is hundreds of thousands of dollars – then you should be talking to people who can advise you – your parents, friends and so forth. Oh, and by the way, the advisors should be telling you the truth... you can't afford it!
But they helped out wallstreet first . The automakes I felt needed the help more and they were raked over the coals.
If I hadn’t seen the push to own first hand, I would say the government owes nothing to homeowners. But I did. The bigger dilemma is how to weed out those who were preyed upon from those who played the odds, and lost. There's no easy answer.
Perhaps there should be some aid for those who at least have a possible chance of paying a reasonable mortgage. The remainder should just be handled as any other person who spent way over their means. We should not be spending money to assist persons who should have known from the beginning that they could not make it.
Give them free classes on financial management.
Right now, my husband & I are working, so we can pay our mortgage. But who knows what the future holds? I'd like the gov't to mandate that mortgage companies be more flexible when homeowners have to deal with the unexpected like unemployment, death of a spouse, and illness. The first course of action should not be foreclosure. In these economic times, foreclosure helps no one.
the government should make the big banks pay back all the money to taxpayers now..AIG, Citigroup, bank of america, etc did nothing but waste money only on corporate executives or unnecessary spending..homeowners need their homes because they are working too hard to own something and let people these banks ripped them off for nothing..i say it's time to make the government do its job instead of getting deals for themselves..you are supposed to look out for the taxpayers who are putting them into office and starting making it an issue when it comes big banks taking advantage of a average consumer...they want the car industry to fail but what about the big banks?....people are giving them the business and they aren't taking care of it..being greedy only makes you look bad and nobody isn't going to trust them at all..
Why not give each eligible voting Americans $250,000. Tax them on it. Create a mandatory mortgage payoff and purchase of an American automobile. Instant stimulus package. Why give more money to people who screwed it up the first time??
Why not give each eligible voting American $250,000. Tax them on it. Create a mandatory mortgage payoff and purchase of an American made automobile. Instant stimulus package. Why give more money to the people who screwed it up the first time?? JP
I wish those who entced people with "sub Prime " mortgages, and circumvented the need for Private Mortgage Insurance go to jail. Not requireing people to prove the ability to afford a house and to have all the future interest in such small print that no one could see it.
The people themselves are also to blame for allowing themselves to be suckered into something they could not afford.
There is a lot of blame to spread, but the real criminals were those who sold people on loans they knew they could not afford. All for a quick profit, then split. They should be in prison.
Given its low rate for borrowing, the U.S. should provide direct, low interest rate refinance loans in exchange for equity-growth participation. This may drive some lenders or mortgage brokers out of business . . . which would be another reason to do it.
I have the answer for this dilema . Forclose the property and allow the old home owner to remain in the property until the bank has a buyer. When the property sells allow the old owner 60 days to move. No bailouts for anyone including corporations!!!
The bailout was supposed to help 400,000 home owners in foreclosure, I understand that to date it's helped 4. Democratic Congressional Math. We'd better start teaching it in school.
The government should enact laws that require compulsory arbitration with the ability to recast mortgages that the mortgagees cannot carry prior to foreclosure..
When houses are foreclosed, the ultimate investor in mortgage backed securities loses much more of the their principal and the returns they expected than if the mortgages are recast and serviced at sustainable rates. The foreclosed properties accelerate the lowering of property values, thus worsening the losses due to foreclosures. These ultimate investors having greater losses due to foreclosures become reluctant to invest in anything, hence the stock market free-fall and the lack of funds to provide credit, even to the credit-worthy.
Recasting the mortgages to sustainable rates breaks this "vicious cycle" of loss to the investors, and reduces their tendency to withdraw completely from all investing, thus easing the credit crisis.
What they should do is simple: Give the banks, lenders, etc 30 days to either tell us what they did with all that bailout money. If they can't (which I honestly don't think they can), arrest them for Theft by deception. Will this help the home owners? It will eventually when they have to pay back the money with a 29.9 variable interest rate. Then the government can do what they should have in the beginning – give 100,000 to every American family!! We can boost the economy, help the housing market, and creat jobs in one fell swoop!
As a REALTOR that works with people going into foreclosure in northern Indiana, the big need is for job creation right now. Elkhart county has an unemployment rate of 12.4% due to lack of manufacturing jobs right now. Other than jobs, I would like to see a loan modification system that makes sense for owner occupants-not for the person whose summer beach house is in foreclosure. The banks need a clear system. Most everybody I come in contact with that is in foreclosure, tells me that the bank will not work with them.
Mandatory refinancing of ARM mortgages that should not have happened in the first place. Create jobs as lots of people are losing their homes because there is no income and the numbers as I see them in 2009 will increase. Federal government could help the states with those unemployed citizens as the states sure don't do much these days to make sure people are working. Time needs to be given in some circumstances to extend the forclosure period to help those that are certain to lose their homes because of unemployment. Imagination Jack, certainly it would be better to take steps that don't cost too much to right this situation.
Jack, I don't want to get technical on you, but, for a homeowner whose mortgage interest amount does not exceed the standard deduction, there is NO tax benefit for home ownership. This is particularly pertinent out here in podunk, IA where you can buy a nice two story house in most any small town for 5, 10, 20, 30 thousand dollars. I'd like to see home ownership everywhere rewarded in the tax code.
They should not bail out any more companies with our tax money that they are borrowing from my grandkids and if we need to let these loans fail then so be it. We don't owe a penny other than our home loan and pay our bills on time with a limited imcome so why should we pay for peoples homes that we given loans that they shouldn't have received. NO MORE MONEY TO WALL STREET OR THE BIG 3!!!!
When gasoline prices soared a few months ago, government did nothing and we figured out how to reduce our own personal consumption. In some cases that meant getting rid of our gas guzzling automobiles for smaller and more efficient automobiles or using one automobile per household. Gas prices dropped and I think we all learned something without government intervention. Should I say anymore.
The TARP funds should have been used from the start to help shore up the "troubled assets" that it theoretically was designed to work on. House prices were inflated but they are falling faster then they should because foreclosed homes are driving down the value.
What should have happened from the beginning was that adjustable rate mortgages on primary residences should have been fixed to their initial values. This would have kept people in their homes without benefiting speculators. The TARP money would have covered the difference between the initial value of the loan to the bank and the new value based on a fixed rate.
People would have kept their homes, and the mortgage backed securities would have solidified to a fixed value at a reasonable cost to tax payers. Instead we have trillions of dollars being dumped into banks by the government so that they can finance mergers and grow even larger.
We are likely to see a tax cut with the rest of the economic turmoil, and that will help a bit, but the government needs to keep those interests rates low and stop foreclosures as part of keeping the banking industry afloat. Banks can foreclose all the houses they want, but if they can't sell the houses they foreclose, they've spent loads of time and money for nothing, and the housing problem will no longer be a housing problem. States should also help out all they can by cutting back their spending while cutting back property taxes.
There is an implicit invalidity in asking what this "government" can or should do about anything, especially monetary or financial things and think that you will get what you pay for. One should think about other expectations, like tax increases and more government, two things the government is good at, too good.
Absolutely nothing if the owners can't prove that they were cheated by their lending institutions. Jack, have you seen the size of some of these homes, these people were dreaming that they could pay for them let alone the taxes. Do they not know what a balloon rate is? Greed , or just trying to keep up with the Jones's is what has got a lot of these people, Those I don't feel like bailing out, Sorry but it's their own fault.
The lenders knew that they were offering a bad deal when they gave mortgages to people who couldn't afford them, and the buyers knew that they could'nt afford them, so neither party should get bailed out. But to end the harm this has done to the economy the government should do the following. Re-write and underwrite the loans at a lower interest rate, all expences and penaltys should go to the lender. Make the mortgages for fifty years each, so the owners technically will own their homes, but might not live long enough to pay them off. In the end because of the long term of the loans, the government will get its money back and the lenders will lose their ill gotten profits.
We have seen that whatever money is handed out just goes to the scum that created the mess we are in now. If the government allocates money meant for homeowners it will just be eaten up in fees and the homeowners will get nothing. That's just the way our financial system is set up. The people at the bottom pay for it and get nothing in return. What a country.
I would like to see some help for those who – through no fault of their own – are facing immediate or eventual foreclosure. If the situation came about because of something they can't control, like job loss or health issues, then I have no problem with giving them some help.
But if we bail out the people who bought houses they simply couldn't afford, and didn't do their due diligence to understand what they were agreeing to (or get help to understand), then what kind of message does that send? How about the people who actually don't buy something unless they can afford it? Who work and struggle to pay their mortgage and pay their taxes and support their families? Why should anyone continue to feel any responsibility for themselves when they can be irresponsible and just have to whine about the consequences in order to avoid those consequences? Is that the attitude we're trying to foster in this country?
Stop robbing our tax money and handing it over to ultra rich CEO's who are hording it for themselves and their companies. We could have paid off every single mortgage in America with the money we've thrown away so far. This alone is shocking. I like Obama but if he's going to continue to foolishly hand over whatever we have left in the Treasury to quench the thirst for Corporate Welfare then he may need to be impeached . . . and very early on!
The Government owes every single adult who lost a home, a decent education, (emphasis on math) and possibly removing their bad credit score! That way they can start over, and the younger adults can actually afford their first home, therefore pushing up the prices!
I don't recall those homeowners offering to pay more taxes when their homes were appreciaiting 20% each year. The speculators gambled and lost. The others bought more house than they could afford. Greed or stupidity aren't good reasons to bail them out.
let the market run its course,my house foreclosed and now i picked up one for 5000.00 and i own it,im glad but my neighbors are pissed.because now their property value is down,im looking for more
HELP THOSE HOMEOWNERS... who were robbed by over priced mortgages and finance fees charged by banks and mortgage companies?
The government should first get back the 350 billion they gave these companies and claim the excess charges from the loan outfits. And remortgage all the homes at a fair market loan. Our homes are being taxed on these inflated prices in Oregon, we would be luckey to get 2/3 of the price we are taxed for on our homes. And to me that is a crime in its self. We were taught in my generation that the bad guys loose and the honest guy wins, not anymore. Where is a "robin hood" when you need one.
_______Here's how I see it Jack_______
3 million foreclosures last year-This year that many or 'probably' more.
1 st : There must be a study to see who deserves to keep or loose their home. If they had 20% down-help them out. If they borrowed against their home; say a 2 nd mortage and didn't previously have at least 20% equity-pass.
Also let me add, finance companies are as guilty as anyone-and the government is giving them as much money as they want,,it seems.
Figuring all this out could employ many for a long time. I own my home-no mortage-what do I get for not causing any trouble?
See if there is a way to refinance, perhaps directly through Obama'a administration. That's better than creating more poverty and avoids scandalous or nefarious behavior and gives folks another chance. Make the laws and qualifications for real estate dealings more protective of all parties involved.
It seems to me that if we can spend all the money on the banks and companies, not knowing exactly where it went or what they did with it, why not give some of the same money back to ourselves to help us, since it is ours in the first place
Since it is odvious that we are to be a mexican like country, I would imagine the government would provide all the cardboard we needed to build a new home.
Jack: Their should be a refinancing agency to assist those homeowners who are about to lose their homes. It should help them reneogiate their motrgages at a lower interest rate and a longer period to pay it off. It should come from the TARP Fund. The first $350 billion went to banks that caused the problem to unfreeze the credit market. The second $350 billion should go to help people with mortgages and unemployment retraining funds.
YES WE CAN!! We can bring no change and keep awarding faliure and bad decisions. Full disclosure has not been done and now Dirivetives are not being factored in. We need 15 trillion to bail out American Banks!! so we can payback the rest of the companies in China and elsewhere.
Honestly...I do not think that our US Senate, Congress or Representatives do not know the fix to this problem our economy is to stop the massive home losses. Fix the problem...have the greedy banks re-set the mortgage payments. No that's not the intent, continue to create massive home losses. Who benefits? That's the real question Jack!
Depends on whether we want the United States to operate under free market conditions. If we do, then folks have to pay the consequences of their own actions. If not, then I might suggest the guidance of the Communist Manifesto.
Being a realtor Jack, this will not solve this problem, but it will surly help if they knew that everyone that has caused this problem, will soon be going to jail.
The government should just stand back and allow the real estate market to self-correct. By doing this they will restore responsibility and accountability back to the consumers. I saw this train wreck coming back in the '90s Jack when I was a Realtor, when regulations relaxed allowing bankers to draw up these crazy no-down, no documentation loans, or as we in the real estate business referred to as NINJA loans (No Income, No Job, No Accountability). Greedy bankers and short-sighted home buyers brought this whole housing fiasco about, and the government looked the other way because there was such political pressure for people with marginal incomes to be able to purchase their own homes. Where in the Constitution does it say we have the right to purchase a home? I can't seem to find it anywhere.
The federal government should help people facing foreclosure by passing legislation that will re-evaluate the price of their homes, which have been artificially inflated for years. Refiance them with at a lower interest rate and offer a short-term no interest loan that can only be used for their mortgage payments. This will reduce the number of foreclosures and keep the profit driven financial institutions from taking away "The American Dream" from struggling families.
Nothing. The first $350 Bil went to the entities who created this problem so they would start lending again and all they did was pocket it and promise to contribute to future political campaigns. Now the Government wants to give money to the idiots who were sucked in by these deals that were too good to be true and we are going to give them money so they can pay their bills when they'll probably just invest in the next dumb scheme that will drag us responsible people down with them all over again. Take all of the TARP money back. I'm done paying for $400 manicures, a CEO's 5th yacht, and idiots who can't do math. This economy is going to crumble no matter what and I want to know that the jerks who perpetrated this mess are going to go down with me too.
At first, I thought that helping "homeowners" was a good idea but, upon thinking about it more, I realize it isn't. The people who are or were living in those homes were actually renting to buy and not really homeowners at all. The banks actually own the homes so people should just let the banks have them back. Americans have allowed themselves to get into this trap and have relied too heavily on credit for their everyday needs and wants. A lesson I learned the hard way is to only buy things, including cars and houses, that I can pay cash for. If these people can't afford to buy a house, they should be renting houses or apartments where they pay their rent in cash every month.
Whats wrong with a $100,000 for everyone 18 and over. Placed in banks who have made good loans, mainly local ones. This is sealed money and basically can be used to purchase, repair, make a home green, pay for college , and if not used can go to help grandchildren for college etc,,, closed sytem where the home is the security based on good apraisals, done by local regulated banks. The money has to be paid back once home is sold, and if not a homeowner the money made off interest could be used to pay rent, college, etc...
Money by no means would be allowed to be spent on everything and everything. Close loop systems!! Australia has a national retirement trust now, we should do the same.
Banks or other lenders who receive TARP funds should be required to renegotiate the terms of mortgages. Increasing a 30 year loan to a 60 year loan would slash the monthly payment and allow people to get back on their feet. Once real estate prices begin to rise again – and they always do – homeowners could refinance back to a 30 year loan (or less) when their home's value has caught up to their debt. Buyers who foolishly used their homes as ATM machines need to bite the bullet and not expect taxpayers to bail them out. On the other hand, buyers who were victims of shady lenders should get some assistance through one of the government lending programs such as FNMA, HUD, FHA, etc.
What is needed is regulation. For the time being at least interest on mortgages, loans and credit cards should never be allowed to be higher than 2% over prime.
The latter will do a couple of important things.
First it will make most of the credit affordable to the consumer.
Second it will limit the amount of income a financial institution can get from a mortgage, loan or credit card which in turn will lower their profits per credit which will mean they will need to issue more credit to more people. This will also make sure they only loan to people who can afford to pay it back since they wouldn't have a hgh enough profit margin to risk on foreclosure and bankruptcy.
The good thing would be the executives salaries would be reduced to more normal figures without bonuses and incentives.
Jack; Could buy the homes and offer land contracts that are affordable. Or buy the homes or real estate like corporations do for executives and hold for the right price or even a profit. Sure take the burden off there shoulders and the creditors shoulders. Could make some good money from the tax money. Kind of like a SBA loan so to speak.
The remaining $350,000,000,000.00 of TARP funds need to be used as direct low-interest, long-term morgages to home owners who were victims of predatory lenders. Those institutions who made the predatory loans in the first place should have to pay the interest on the National debt accrued from the entire TARP fund.
Tim in Texas
I hope I dont have to use Illegal Mexican labor to build my Cardboard home. Infrastructures Jobs, would helpe be employed;; if I didnt have to get behind 50% illegal labor, in that market. Then I could have a JOB and a HOME.
Nothing. The people that borrowed more than they could afford need to be held accountable for their mistakes. Why should the government(ie you and I) have to pay for their stupidity.
Jack, I think the homes that are either in foreclosure or close to it should be re-appraised and the the mortgages should be re-written based on the realistic value of the property - especially if these instutions have received bailout money. I have a hard time feeling sorry for people who bought more house than they could actually afford or the greedy banks who did not proplerly evaulate a borrows ability to afford the loans – but then again I'm conservative by nature on finances.
If the government would have a bailout, it should be for all homeowners. All homeowners have lost substantial equity in their homes. Therefore, the only bailout for homeowner should be given to buyers who were conned into signing their lowan agreement witht he mortgage company.
Instead of helping the squeaky wheels and those who've already royally screwed up, they need to bail out those of us doing it right! We're the ones who've proven we can manage our money and help grow the economy.
So, give me lower interest and payment rates on my mortgage and student loans, and I'll be happy to go shopping with the savings. Heck, I might even use the extra cash to start a business and create jobs in the process.
All I need is (24) Twenty thousand dollars to pay off my mortgage and Id be all set.
The government should freeze mortgage foreclosures and sort out the ones who truly deserve help. If Minnesota can recount nearly 3 million votes with utmost scrutiny, each mortgage holder (lending institution) could peruse the millions of mortgages that face foreclosure, and hopefully, save some good and honest people. Guess what? It won't happen, Jack. There are too many lobbyists protecting their ass-ets.
The government should do nothing – the situation is messed up badly enough as it is. We let ourselves get stuck into this mess anyway. The warning signs were all over the place, and we ignored them, until the economic rug got snatched out from under us. We're heading for a big fall, and ultimately we have nobody to blame but ourselves. – D.
Instead of giving the money to the banks give it to the middle class. We would use the money to pay off our mortgages, credit cards, and car loans. That would help the banks the credit card companies, and if our cars are paid off we would be able to buy a new car instead of fixing our old one. That would take care of the car companies. Problem solved!
This is a hard one. If the homeowners tried to pay in the first place, that is good. A lot of them don't pay and spend money fooliishly. I think they lower the interest rate and keep the payment down low, so they can pay them. If they can't pay the lower payment, they have bought more than they can afford. When we bought our first house, we first ask what our payment would be. If it was too much, we looked elsewhere.
Easy FHA and VA loans with a 10% tax credit spread over five years . Ralph, Yakima, Wa.
The best thing the government can do to help homeowners would be to stop subsidizing them. By keeping interest rates artificially low and by propping up the prices of home, the government will create a bubble that is bound to burst. How do I know this? It just happened a few months ago. What short memories some Americans have.
The government should stay out of it. Things are bad enough without them making it worse. My house value is down, but so are the houses I might want to buy.
The federal government signed treaties with Native Americans generations ago, promising education, medical care and housing to Native Americans in return for ancestral lands. Not a single promise has been kept. With nothing to trade or steal, should the rest of America expect anything less.
Take all the K Street lawyers and tell them to take the time spent bribing Congress and spend it instead doing pro-bono work for people in foreclosure. Countless articles have been written regarding predatory lending practices and fraud, as well as the proof of who actually holds the mortgage when it is supposedly divied up in these credit default swaps. Once these firms rework mortgages and save a certain number of families from being evicted using the law, then give them their access to Congress and administration officials. Obama wants people to step up and serve our country without joining the military. Let's see the lawyers that contributed so much to the financial disaster we are in turn it around for their fellow Americans.
I would like to bust the bubble of those who think that the only homeowners in trouble are those with ARMs. I've had to restructure my VA 7.25% 30-year loan because of the recession we've been in since 2001. I've almost lost my very modest home in a suburb of Dallas twice because of the unstable employment market.
In 2001, one of the major industries in Dallas tanked, telecommunications. 35,000 high tech professionals were dumped into an already stagnant job market. It took 13 months of hard work and networking to get back to work, and it has remained sporatic. Luckily for me, I found a stable company and now have a stable income. That's why my mortgage company agreed to let me play catch up on my mortgage. I still have little in savings, a 15 year old truck with no AC (which is hell in summer here in Texas!), and have had to sacrifice a lot of home improvements that are really needed, just to stay in the place.
Recent stories that have surfaced include people like the 85-year old woman thrown out of her home after she lost most of her savings due to the Wall Street meltdown. She had only lived there for 60 years, and had had to use it as collateral on a loan to pay medical expenses. There are thousands of similar stories. To characterize ALL homeowners in trouble as people making $14 an hours buying $350,000 homes with ARMs is both untrue and unfair. The stock market, unstable job markets, loss of jobs to off shoring, medical emergencies, second mortgages to send kids to college, etc. are all contributors.
Yes, there were a lot of people who swallowed the real estate agents and the finance companies marketing schpiels. But there was culpability on both sides; on the side of the home buyer thinking they could get more for less, and the side of the real estate industry and finance companies. When I bought my house in 1990, the finance company raked me over the coals for a late credit card payment 10 years before. That type of accountability and attention to detail got lost in the orgy of companies buying each other, buying assets from one another (my mortgage has been sold at least three times without my knowledge), and the general "good time Charlie" party on Wall Street for the last nearly a decade. There are a lot of culprits out there, from large Wall Street companies to homeowners who got something that really WAS too good to be true.
I think the sould help these homeowners out, but they also should go after the Morgage brokers that talked the homeowners into these risky deals, just to make a commission.
I am one of the few who over 25 years learned how much of a house I could afford and have paid my mortage off. Now others must learn and sometimes it is a hard lesson, but spend (or mortage) within your means. If one must refinance for a longer time period that is how the system worked and still does. Bite the bullet, if you want a house pay it like the rest of us or move to something within your means. Don't put the burden on others. Some times this may mean two jobs for one person in the family, believe me you wont be the first to do this. If all you people want is a hand out, include me I want the same amount. How about you Jack????
REFORM THE CREDIT AND MORTGAGE SYSTEM!!! The banks and lenders are making billions on truly obscene fees and charges. My friends and neighbors have been blindsided by variable percent loans that they were told were linked to the cost of credit for the bank, not to their compliance with their contract. One late payment and the interest went so high they found it almost impossible to make the monthly payment. They had to refinance, and then refinance again. Banks should not be able to change your monthly payment amount and penalty fees should be reasonable. Help homeowners by taking the greed factor off the table for the big banks. Then shoot all the CEOs. Just kidding, I think...
Just a few thoughts from a non-"expert." Ban any balloon type loans and adjustable rate mortgages. Refinance all current mortgages at 4.5 % free of fees, etc. to the homeowner. Reduce monthly payments to one half for the next 5 years. If still unable to avoid foreclosure, then have the homeowner take over or downsize to another's forclosed home that they can afford to make payments on. No loan shall be made without complete financial investigation by the lender of the person's income and monthly expenses. Make all lending/mortgage institutions responsible for any loans granted to anyone beyond their means. Finally, end property taxes for homeowners 65 years or older, nation wide, on their primary residence.
Money is the root of all evil, Jack. So why don't we get rid of it? They say that cockroaches will survive long past the extinction of humans. Aren't we smarter than bugs? Can't we figure out better ways of doing business with each other, getting along with each other? The only thing keeping the human race from advancing to unimaginable heights is not our lack of intelligence. It is our lack of faith in ourselves. We should expect and demand better of ourselves.
Homeowners should be able to walk away with no more penalty than a credit score that is in the basement. I have always heard "buyer beware" now the shoe is on the other foot "lender beware"
The unregulated sub-prime mortgage crisis is the source of our economic crisis. But the sub-prime mortgage crisis is not the only problem in our economy. George Bush and the deregulators have been busy working their magic destroying the middle-class for eight years. The interdependence of the middle-class, financial institutions, and industrial institutions can not be separated. The middle-class purchases their goods and services. Defaults on mortgages, credit cards, auto loans and student loans will cause many more banks and industries to fail. Until the health of the core of our economy, the middle-class is stabilized, nothing will help our economy turn around. It's the middle class stupid.
Susan from Idaho has a good point.
I think they shouldn't bail out anyone who's been flipping houses or -clearly- speculating beyond their means to pay. For the rest, refinancing at a lower interest rate (perhaps for a longer time) would make sense.
And Wouldn't it be nice to have some kind of tax credit (or cash bonus) for those of us who've lived within our means, saved carefully and paid off our mortgage–or at least have never been at risk of foerclosure?
Sometimes it would be nice to see REASON rewarded, not just greed or naiviete.
There should be a tax credit for first time home buyers that can afford a mortage at 5%. This is a great time to buy but seemingly a bad time to lend because the government is too busy bailing out FAT institutions who have driven the American economy into the ground. Instead of Bailouts people should be put in jail. If we dont find a way to create more jobs this is all moot anyway.
Jack, since 'government oversight" is oximoricic, there's no doubt that most of the taxpayers' money won't trickle down to those that the bailouts were supposed to reach. Who's going to take the calls from the thousands of qualified home buyers who are denied loans from banks that want the money for acquisitions etc. There needs to be in place a system at the local level to report & act on the way money is being spent. What would you & Lou do for the American people to issure that the billions aren't wasted???
No direct bail outs, there is no room to explain the 50 reasons why.
It can benefit the home owners by temporary rules excluding eviction (one time 3 month moratorium), charging a $5,000 fine for no-doc loans, eliminating (outlawing) future ARMS, strengthening banks through eliminating credit default swaps, outlawing excessive bundling and re-selling of mortgages, and generally re-regulating the financial markets.
The banks already got the money from the taxpayer, so it's time for them to write off the losses. I have no sympathy for the banks, at all! Calculate what the house is worth now, force the loans at 4.5% at the new valuation and this is a done deal–it ain't rocket science
People who bought homes above their means should not be rewarded by another bailout. no consideration is given to those who bought within their means and hae not defaulted on their loans. The government should back off. since it has already been proven that they cannot account for money given away and are basically clueless. My city raises the assessment on our homes (so they can collect more taxes) even though we cannot stand a chance of selling the home for thousands under the assessed value. The taxpayer and responsible home owner loses.
Simply this, get rid of money. Material wants are an abomination. Just live on the basic food, cothing, and shelter. That's it.
Paying out government money for failed mortgages is not the way to help people. Oversight by a government agency to insure that people don't try to own homes that are way out of their price range would be more productive. A cap on the interest rate that can be charged for a home loan would protect consumers from being scalped. With these two safe guards, the American people can purchase homes and someday own the title to them. For the people already in arrears because they were trying to "keep up with the Jones", there is not much left to do but visit your local grocery and ask for boxes and start packing. The American taxpayer did not sign up to be these people's guardians. Call it tough love.
Take the 50 billion dollars that Madoff stole and use that to pay off a bunch of mortgages that have gone sour. You help the banks, you help the people keep their homes, and a criminal suffers. It's a win-win solution all around.
We owned our home. Bought and paid for. My husband got deathly ill, spent 51/2 weeks in ICU, had insurance and still had an enormous bill. I had to quit my job to take care of him. He's been in and out of the hospital ever since and we had to mortgage our home for twice what it's worth to pay his medical bills. Not everyone has made dumb mistakes in getting bad loans. Personally, I think the government should take over the banks, like FDR did and revamp everyone's loans for what the houses are worth. For God's sake, give us a break.
The government should require the banks to renegoiate mortgage loans to a more reasonable rate of interest for the home owners. The banks are in fat city with the Fed rate at or near zero, and with the influx of 200+ billion $'s in taxpayer money from the stimulous package. Yet, these same banks are refusing to lend money to the people who need it.
They should help homeowners by granting direct relief and consumer protections, rather than rewarding and protecting the corporate powers that produced this tragedy. When, if ever, will government admit that trickle-down economics destroys regular Americans while benefitting only the wealthy?
Didn't Harry Reid say to people who are losing their homes, "help was on the way" when they passed the bailout plan? We're still waiting.
What should the government be doing, if anything, to help homeowners?
They should force those financial institutions, that accepted TARP, to buy up those toxic mortgages and re-negotiate new mortgages to fixed rates, and as many years that they need to pay in order to be able to make the payments low enough to actually pay them. They should not use the excuse of poor credit as a factor not to give these new loans either.
They should stand up and do something for the American people, no matter what that solution be. The best idea that had been tossed around was to buy up all of the toxic loans and to rework them directly with the home owners. The mortgage companies aren't about to do anything to protect the homeowners, unless the government stands behind them and threatens them with prison time. Ooops, that would be a white collar crime, which means no prison time and only a slap on the hand. Forget that idea.
Jack, they should do what they said they would do from the very begining. Address the subprime and mortgage market. That's what got us into this mess in the first place. That and Wall Street's greed. How can you get an handle on this mess if you don't attack the real problem and stop the bleeding. As long as people continue to go into foreclosure in record numbers, then our economy will continue to fall down into the toliet. Somebody needs to wake up and stop playing games with the US economy if they want to leave something for their children and grand-children. HELLO.
They could start by cracking down on predatory lenders, rather than supplementing them. Then, they can pull money from their "blame the homeowner" campaign and make low-interest government loans to the people losing their homes that have either lost their jobs in the last year and those who can provide proof of being victims of the predatory lending practices. While they are at it, they could keep a list of those same folks and call them first and offer the infastructure jobs to them.
I wish someone could have helped me when I was busting my tail to pay off my mortgage. These people that got in over their head need to stop living beyond thier earning income.
The gov should give the American people their money back and we will fix the economy. We have been paying taxes and watching our money get sent to everyone except us for years. Iraq gets our money. Pakistan. Afghanistan. Israel. Egypt. Colombia. Trillions of dollars for everyone, but nothing for us. Most other countries get health care and tuition for college. Give us our money back, and we will spend our way to prosperity yesterday. Give each adult $20,000 and the economy would rebound before the checks were deposited.
Sadly, this will not be done. And the proposals on the table now will not work. We will be mired in 100 Big Dig projects, all fighting for funding, one state against another, one project against another. all projects against the EPA, all accused of corruption, all sure to overrun cost estimates.
First lets make shure it helps people that need it and it`s not an other hand out so someone keep up a lavish life style. Too many people have been living in a house costing hundred`s of thousands of dollars, when they should have been living in a mobil home.
You have to be careful here. Why should we subsidize those people that had no business jumping in over their heads? Everyone was on a roll and were betting that the dice would keep coming up in their favor. Those people that have been layed off and are finding it difficult keeping their modest home investment is another story. We subsidize too much ignorance already. so proceed with caution, mister president.
I think the federal Govt should stop giving money to the Banks, Wlaa Street, and instead give TARP moneies, the BILLONS, to each home owner in trouble. Then the home owner can pay off all his debt, and stimulate the encomy.
Thanks keep up the good work
It’s not the government’s responsibility to help idiotic homeowners who bought beyond their means. I think a better question would be, "has the government ever helped us?" Only when there is overwhelming demand from the people. We rely too much on the government to help us. What we need to do in this time of crisis, is to rely more heavily on each other by buying local, volunteering, helping out our neighbors. Basically we need more community control and stop looking for an obviously corrupt system to bail us out. They don’t care about us; we’ve known that for generations, but it’s our false sense of hope that keeps us believing that, oh maybe this time they’ll listen.
Nothing. Just sit tight and watch the show. I bet all these 860K families who lost homes are not qualified in the first place for home loan because of their bad credit. Because of the bad policies by earlier governments the current mess. Bailing out financial institutions is not going to help any body. Already 350 Billions dollars are down the drain. Let Obama government save the remaining 350 billions. The best option at this point of time would be to amend the mortgage law and allow the house owners to keep the homes by paying 1/2 of mortgage payment until their fiscal situation is back on track.
Because it will not do any good to prop up banks if there is no one left to spend the money the banks have to loan. The majority of people in this country fall into the middle and poor classes and they are the ones hurting. If they aren't helped, they will not be able to spend money to support this economy.
Bailouts are not popular but it seems the American people would support a national bailout exclusively for home mortgage foreclosures...the notion that homeowners in certain circumstances intentionally purchased mortgages they could not afford is by no means black and white, the story has been skewed by the media, every situation in every household is different...in any event the objective is to control the housing market, to preclude further decline if possible, this in turn will build consumer confidence and fuel the economy at least in the short term allowing the Obama administration a measure of time to set a more positive economic agenda in 2012 and beyond...
I think each situation is different. Some homeowners simply cannot afford to stay in their homes. Others who can by receiving a modified mortgage should. In no case should any one receiving help be able to take profits out of their home, any profits should go back to the taxpayers first.
There is a lot of blame to go around for this mess. Uneducated consumers. Mortgage brokers just out for commissions, mortgage under writers who wrote mortgages they should not have.
Just because a homeowner is "underwater" doesn't mean they need help. There is no "loss" until a sale is made. If they don’t need to sell for drastic reasons they should just stay put.
We need to financially educate people. One rule of thumb is you don't buy more then 3 times your annual income. I have no compassion for anyone that broke that rule.
For those who just "walk away" from their mortgages, their credit records need to reflect that and they should have a much harder time getting a mortgage in the future. For those of us who meet our obligations and don't act irresponsible, we shouldn't have to subsidize those who don't. Neither thru higher mortgage rates or our tax dollars.
My home has decreased in value which on the short term is not too bad,but I would like to refinance so I could possible rent my house out and buy a house that has also decrease in value at a lowered interest rate so lower the interest rates. This will get more houses off the market and put some money in circulation.
When banks were hurt by bad mortgages in the thirties, the government created the FDIC in order to get people to once again trust the banks. We should do the same today. All mortgages should be insured by the government. That will get investors back, which in turn will give the lenders the cash and the will to lend. If people can borrow again the real estate values will recover, and people will again have money to spend (You didn't think the spending during the last few years was due to the Bush tax cuts?).. It won't help many of the current home owners who have no jobs and negative equity, but when the economy recovers hopefully lenders will give them a second chance.
This isn't about homeowners anymore...it is about everybody! Maybe the American dream is to own a nice house with a two car garage and a white picket fence. What about bailing out those people living on the streets in cardboard boxes? If we continue to act like this as a country we don't deserve the blessings which were brought upon us when we become this great country. Don't you think it would be kind of hard to plan for the future if you didn't have one?!
I think that the govt should have some kind of program, where the govt appraises the house, sets up a good solid mortgage on the house, at the reduced appraisal rate. No ARM, just solid mortgages for XXX dollars per month.
but on the other hand, I also agree that people bought far too much house for far too much money. If the bank says you are qualified for a 500,000 mortgage, that means that if you struggle enough, you can afford that house. If I was qualified for a 500,000 house, I would look at buying in the price range of 300,000. that way we would have available emergency money to save or use to pay off credit cards. People were living way above their means and had no way to fix anything.
Nothing! What ever the government touches gets worse.
They should let everyone with a mortgage refinance for the lowest rate available. Right now there are great rates, but you need 20% equity to be able to refinance. Nobody who bought a house in the last 5 years has that much, if any, equity in their house due to the decline in value. However, if everyone could refinance, it would instantly put a couple hundred dollars into their pockets to spend and help the economy. This seems like a no brainer to me. There is no risk to the banks because if you can pay your current mortgage, you can pay a smaller mortgage.
The government should use part of the 350 billion dollars that President-elect asked of the Congress to help homeowners get back their homes that are foreclosed. Americans would be happy to have a roof over their heads. Its their money and they can breathe a sigh of relief.
No more bailouts for banks, mortgage companies, and financial institutions. The tax payers and home owners need the bailout. Between property taxes, people losing their jobs, late mortgage payments, rising cost of food and utilities, giving more money to fiancial institutions will not help the American tax payers. The first bailout did nothing for us and can't be accounted for; why should we hand them any more money? Does anyone in government read these blogs? If not, we are all just wasting our time.
We have so many unemployed that something needs to be done to keep them in their homes until things turn around. These homes sitting empty aren't helping anybody. It amazes me that a financial institution would rather take everything you have and throw you out on the street than try to work something out until you are on your feet. And they will take a loss to do it! I don't know what should be done but they got OUR money and it is time to step up and help us all get through it instead of keeping it to themselves and throwing us to the wolves.
Let's see, buy someting you know you cannot pay for and then claim you were tricked and wait for somebody to say you don't have to pay for it. That's what I want to say – do nothing. However, the reality is some folks can hang on with a little help. Also, the government has poured billions into banks ( the guys who made this problem) with little effect so maybe some direct help for real people would be OK. Why not, just a few more hundred billions. Let the government back refinancing to those who meet some reasonable requirement for ability to pay, perhaps at a lower interest fixed interest rate. However, DO NOT forgive any principal. Just tell poor saps like me who struggle but pay on time to get over it.
Instead of giving rich people the money, they should be covering peoples mortgages.
Change the Adjustable mortgages that will change within 5 years into a 30 year fixed with a lower interest rate. Force the finance companies and Banks to make the changes, or take the tax payers money away from the Financial companies and banks and give it to the tax payers who have Adjustable mortgages that are coming up in the next 5 years.
the government should use the additional TARP money to build prisons to house all the crooked mortgage brokers that sold the horrible mortgages to unsuspecting clients. in my line of work we had a saying "3 crappy loans, plus 2 stupid people, equals one overpriced house"
No bailouts! I don't see where it is the governments responsibility. First of all, the banks didn't tell us what THEY did with "our" bail out money, and now because people were stupid enough to sign for these mortgages, we, the so called silent majority who pay their bills and are responsible citizens are supposed to say "sure take what you need!" I don't think so,,........
The economy is stuck becuase too many people are upside down on their houses. The federal government should negotiate with lenders on behalf of homeowners to reduce their debt to 90% of the current market value of their homes. Those who have had to short sell should get a tax credit for the full amount lost. Then they should go back and throw all the predatory lenders into Guantanamo. The bay, not the prison!
Jack, I just wish someone would think of the millions of renters out here who are constantly getting ripped off!
all foreclosures should be done away with . Mortgages should be reset at lower rates .And I don't know how they would do it , (but they keep bailing out the big guys). Come up with a figure and this should be taken off all middle class mortgages across the board .
No more corporation bailouts – enough already . if they can't manage their co's –say goodbye
Jack lets face it this is the time for the Goverment to step in with low and I mean low intrest refinace program. Getting little in return is at least getting something in return is it not? You see if the trend of forecloser continues there will just be so much out there to buy the real estate market will continue to be in a depressed state with not enough buyers to even be able to take advantage of such a situation.
If nothing is done the problem will only compound and hurt us all.
The government should void all of the mortgages that are not "standard" and force the lenders to renegotiate the mortgages.
I know most people don't agree with the bailout. But, if instead of giving the money to the bank and never having a clue about what they have done with it (our money). Why doesn't congress ask the banks to send them lists of all the foreclosures and preforeclosures they have pending. Then congress can pay past due amounts and pay ahead about 5 or 6 months on those homes. That would let everyone know where their tax dollars are going and help the "people" directly. Better than turning our money over to those who helped put our country in the first place.
It's simple. It always is. Make these banks rewrite loans to a reasonable rate period. With the reasonable rates, people can afford things better and start to put money back into the economy and create jobs. Prosecute these people who commit fraud with other peoples' money just like you would someone who robs a bank. I ask you which robbery is worst?
It has puzzled me why no one has suggested if people were in over their heads but could stay if the payments were reduced to what they purchased them for, why could not the loan be extended in length of loan in some of those cases to avoid foreclosure, i.e. from a 30 year mortgage to a 35 year mortgage?
I just hope they catch the people who gave these shoddy loans and make them at least do community service for a year!
They should get Fanny, Freddie and the banks to offer 5 year morgages at a rate the homeowner can afford, provide mortage insurance. At the end of 5 years, the homeowner would refinance to a regular mortgage getting a crdit of 5% of mortgage payments as equity..
The Fed's should help home owners as follows:
1) Demand a seat on the board of all institutions that have taken federal TARP money.
2) Foreclose on any bank that does not adjust mortgages for homeowners in distress.
3) Foreclose on any bank that does not provide lending.
4) Foreclose on any bank that does rate jacking on their credit cards.
5) Take over a bank (oh, say, BofA) and use it as a competitive hammer, delivering federal funds directly to credit markets / customers in the process.
6) Kill TARP (Treasury Allocation to Rich People).
As long as we give money to corrupt CEO's and failed banks, car makers and other failed businesses no improvement is in sight. We need to understand that the citizen is the one that needs a bail out due to the outsourcing of good paying jobs, jacked up health care cost, frivolous wars, illegal immigration, high gas prices and fraudulent lending by banks. Give the money to the people and small businesses.
If they have appropiate income, let them refinance at a lower interest rate. If they do not meet income requirements, they should be evicted and find housing they can afford.
Do you know how long they have been talking about helping homeowners? Do you that they are just talking and doing nothing? Millions lost homes and the bill is not going anywhere in Congress.
At least they are getting paid every week, good life in DC, health insurance for their families, free transportation and free access to K Street. The only people suffering are americans who are asked to vote for these monsters every 2, 4 and 6 years.
Why is it that absolutely no one in this day and age will take any responsibility for their actions? Home buying 101 Jack. Don't live in a $465,000 home if you are earning $35,000 per year. End of discussion. I for one, who has paid my mortgage every month for 30 years, do not want my tax dollars going to bail out someone who made a poor decision. Don't only blame the lender, you simply have to start taking the wrap for your own poor decisions IF YOU PUT YOUR HAND ONTO A HOT BURNER AND GET BURNED, SHOULD THE GOVERNMENT PAY FOR YOUR MEDICAL BILLS TOO? No they would blame either the manufacturer or George Bush I suppose.
Let's see how do you help the people who got in over their heads without hurting the people who were careful with their money. Help home buyers with an incentive and keep interest rates very low for morgages under 300K.
Yes, Yes, Yes. Limit homes with values of 250,000 and under and
Incomes under 150,000. This would be a help to the average
Take defaulters on case by case basis: 1) for defaulters with some income: restructure the loans at lower fixed interest rates and longer number of years. 2) If they don't have the income, gov't should take over the mortgage and lease it to the former owners at a reasonable rate. 3) if the mortgage is larger than the present value of the house, divide the loss between the bank and the owners, then restructure the loan at present market value. Eliminate people with multiple houses they were "flipping" and got stuck with.
The plan put foreward by the head of the FDIC is a good start. Many home buyers were put into loans that, while very profitable for the lender, were not in the buyer's best interest. I do not have a answer for correcting those problems. I do know that a fair percentage of foreclosures localy are on "spectulator" loans. In such cases tennants who are up to date on their rent payments should not be evected . The "speculator" should be S.O.L. (as we used to say when I was wearing a funny green suit and being treated to a scenic tour of beautiful IndoChina by my generious Uncle Sam...)
I have no idea what the government should do! Government officials are paid to help solve these problems so maybe we should be asking them these questions. Home owners are losing their jobs and in result they cannot afford to pay for their homes. Plain and simple.
It looks like a lot of financial institutions are going down for the final count if the foreclosures continue. I would give them the option of reducing interest rates on viable mortgages to a level that the homeowner can handle and that provides a slim margin of profit for the corporation. That way at least the lenders will not lose money with a foreclosure. The days of unbridled greed and record profits are a footnote in our economic history. It is time to make corporations act responsibly. Giving them the option of acting fairly or dying works for me.
Like many others, I worked to pay my mortgage every month, sacrificing vacations and certain luxuries to be able to keep a roof over the heads of my family. I finally paid off my mortgage, and find it dificult to feel sorry for those who bought homes that were out of their price range. As far as house values, how would you feel if you paid off your mortgage, looked at the interest you paid over 30 years, and then see the value half of what is t was 3 years ago? Now your tax dollars are supposed to pay off another home owner's idiotic mortgage that was given without regulations?
No matter who holds your mortgage or how low your interest rate is, you'll not be able to avoid foreclosure if you don't have a job and can't find work.
The gov't needs to disallow any foreclosures from going forward. Buy the mortgages based on present value of the homes. The bank or mortgage company will have to absorb whatever loss there may be. Now the gov't and the homeowner will negotiate a new loan. If the homeowner is unemployed and running out of benefits, the gov't will help that person find a job with the new WPA that Barack needs to get up and running.
Stop foreclosures and get jobs for people. Can't work on one problem without working on another.
San Clemente. Cal.
Stop handing money to banks, and start loaning it to people to buy or refinance their homes.In the 70's the FHA 235 program helped people to buy homes with a low downpayment, no closing costs, and they were subsidized until they could afford the full payment themselves. I would rather provide a subsidy for someone to own a home than for to subsidize banks to buy other banks or just let the money disappear. When housing sales pick up, everything else picks up too, because they need things for their homes.
They should give me, the daugher, 57,000 dollars to pay off this 30,000 home (what it is now worth now), because Country Wide allowed my dad to refinance, not once, not twice, but three times after it was paid off in full. Then maybe I can get the house put in my name and try to get the 50,000+ work done that is needed to bring the house back up to close to what it was orignally worth.
Give those who are in trouble a class on personal finance. Most are in this mess either because they couldn't afford the mortgage in the first place or they were speculating and thought the prices would go up forever. A minority are in trouble due to circumstances beyond their control, like job loss. For them, and only them, the gov't should guarranty low interest rate, fixed, long term mortgages (40-50 year terms). Banks won't make much, but at least they won't lose much, and innocent people will not end up homeless. For the speculators and stupid people, let 'em live in tents.
They need to help the people that are actually paying their mortgage. The government is helping people that probably can't afford homes in the first place and not freeing up enough for the people that qualify. If qualified homeowners refi at todays lower rates they will most likely try to hold on to their homes this should also raise spending and help the economy in the long run
There's not a good solution.
If we bailout those in foreclosure, why should anybody pay their mortgage?
If we keep shoveling money to the financial institutions, they will keep throwing their expensive parties and continue to evict those in need.
If we use the money to refinance in order to write more affordable mortgages most of the people involved can't afford anything!!!!!
I guess the best thing to do is to pay EVERYBODY's mortgage and start on a clean slate. YA RIGHT!!!!
Life's not fair, and even if home ownership is the American Dream, we as a country need to wake up, collectively. That said, I think that the more people that are able to realize their potential has to be good for the overall economy, and a home is a basic part of making that happen. It's the same principle as reforming healthcare, and to package it for those Right wing-nuts, try calling it "trickle-down" productivity.
I will be listening to hear some good comments on this question. My late husband and I owned clear and free a cute little house which I stayed in for about 5 years after he passed away. Finally I had to move to a rental apartment as I could not keep hiring the yard to be mowed, the driveway shoveled in the winter, property taxes going up and up and then the inside needed painting and carpeting. So I have rented it out and hold my breath that the renters don't tear it up or stop paying their rent as that is what is helping me get along right now!
Jack, most home values have plummeted, I know because when i refinanced my house was worth nearly six thousand less then the last time. So, I say all the tax assessors must re-assess the homes who have mortgages on them, if they come in lower then the previous assessment then the banks must lower the mortgage amounts to that amount. That will help all homeowners, and with the money the homeowners save, maybe they can stimulate the economy by buying a cup of coffee or gallon of milk!
For whatever amount the property apraises at for tax purposes, make that the basis for a loan to the distressed or recently forclosed homeowner, if they can qualify for a loan of that amount, and reissue a loan for that amount with their current lender. Let the banks and mortgage brokers eat the difference as a loss. Then fire all executives and managers that had anything to do with all these bad loans and sue them to recover undeserved bonuses and stockoptions to cover tax payer expenses.
Greed in our society is finally catching up to us. Realtors charge 6% to sell a home and make a lot of money. Lawyers create laws with no regulation and then sit back and make more money in these situations. Athletes want more and more money to play a game. Wall Street is number two of all crooks along with the CEO's with these personal gains of millions and millions and then want bailouts for lousy management like the Auto industry. And now people may be able to buy a home when they shouldn't have and want us to pay for it, sounds like a good plan.
Put everyone who looses their homes in FEMA trailers until they can get back up on their feet. I really believe we are in a depression now, the only difference is we are printing money to make it look like we have money! We all may living in a FEMA trailer or a tent before this is straightened out! Banks and the people are too blame for trying to keep up with the Jones's and not worrying if they can make the payments.
The problem was exascerbated by banks making sub-prime loans to people who had no business getting these loans and speculators who bought houses and then flipped them to make quick profits. The people who should be helped are the honest ones who got conventional loans and paid their payments every month. No help for speculators,con-men and people who were just looking for a loan that they should not have qualified for.
The government didn't cause this mess, and it is not their business to use taxpayer money to pay for others mistakes, or wrongdoings. No one pays my rent, and if I don't pay it I'm in the street. There would be a lesson well learned if people had to sleep in the street a few nights, it surely taught me that it is my responsibility to make good sound decisions, if not it is my fault.
"Women and children first!" Just like on yesterdays USAir flight we need to focus relief efforts on homes were families, especially single parent homes, are at risk. The DINKs who tried to use the No Money Down schemes gambled and lost–to the back of the line for them. Because of this mess many of us can't afford to send our kids to proper schools and that strikes at the core of America's future.
Kent Co. Maryland
How about the government passing a law that makes it ILLEGAL to sell a house with one of those crazy ARM mortgages? That would be one helluva start!
Government has done enough already. If we want a free market, buyers and sellers both have to live with their bad judgments. If we don't want a free market, I refer you to the Communist Manifesto.
Instead of bailing out more greedy banks and corporate ceo's, they can give the people $300,000.00 to pay off their mortgages and pay off their bill and that will get the economy movie, because people will be spending that money to get out from under all their problems!!!
The job of the government is not to help home owners no is it to help bad business decisions so the correct answer is nothing
Perry jones council bluffs iowa
We should help them, but they should be last on the list to get help. First we need to put people to work, job programs, real jobs, real money, real spending, real recovery.
Renegotiate all interest to fixed rates for owner-occupied homes based on current values, – get those people who had increased interest rates out of the mix and get them back on track if they can afford new lower adjusted payments – then check out the lenders who knowingly lent to un-qualified borrowers, if the lender was responsible then re-negotiate with the buyer if possible, if the borrower lied then tough luck to them. That should leave the "speculators" glowing like krypton and cancel their loans letting the chips fall where they may – we have to start somewhere and don't try to tell us that all the necessary information isn't available, it's all on computer files – if you take $20 out of your ATM in Portland, they know you spent it in FL.
Anything they can do to help the folks who are drowning in their mortgages would be a plus for the short term. In the longer term, we need strict regulations on lenders to prevent this sub-prime nonsense from ever happening again.
nothing people bought these homes they couldn't afford thinking the economy would be good forever and didn,t realize there are up's and downs in the economy as we are expierencing now
I say we declare a National Bankruptcy. All debts forgiven. Individuals, cities, states, the Federal Government, businesses, EVERYBODY. Any debts owed to foreign nationals? They can stand in line and petition the world court. Start form scratch and rebuild our economy and re-establish our international credit based upon what we have and can actually do. And then, for God's sake, enact a Constitutional Amendment requiring a balanced budget.
Just do it. Who is to say that we can't?
I don't know Jack, but let me know when the number of empty McMansions is higher than the number of homeless. By then, I'll have an idea.
Isn't this the same govenment coming to the rescue of homeowners that was the originator and promoter of the sub-prime mess? Stand by for the next governmental fiasco. It will be a doozie.
this isn't simple this is like going to the moon everything is unknown. But the best thing the government can do is try and create jobs.
Easy answer that will not cost a thing. Mandate that mortgage owners allow people in trouble to back load their mortgage for up to six months. In other words extend the term for up to six months to cover non payment now.
Genuine hardship cases will be able to recover in time. The banks are getting so much TARP money they will loose nothing!
too late...they should have used the original bailout to help one time or one home owners reduce their payments and avoid foreclosure which helps no one.
The Government should assist those homeowners who when the origional contract was signed had a legitimate hope of making payments but due to unforseen circumstances were unable to continue the contract. No help should be given to those who from the outset had no ability to pay the loan.
The government should do whatever is necessary to help those homeowners thru no fault of their own are losing their homes to foreclosure. It ticks me off to hear the Republicans talk about the government is NOT suppose to do this or the government is NOT suppose to do that!. But yet WE pay our taxes to the government or get thrown in jail if we don’t. Those taxes are sent by our GOVERNMENT to other countries and we have no say as to where our monies go. The GOVERNMENT has spent $600 BILLION dollars to rebuild Iraq and pay blood money to insurgents and yet we have no say about that!. Yes the government should help the homeowners, my God! Do something for AMERICA for a change, and not for the hundreds of foreign countries that we send billions to each month.
Back in August when the bottom started falling out and that $850 billion bail out package was put together, I said then that they should just issue each taxpayer a $250,000 check and be done.
The economy and banks would have been saved because folk would have paid off their mortgages, credit cards, bought homes, cars and saved money. It would have been far cheaper and at least folk would have known where the money went.
That would have worked and would work now. Don't give the banks the money. They have money. They're just holding on to it and won't renegoiate the loans. Give the money to those affected.
Other than that, declare an across the board bankruptcy like Tripp from PA said and let everyone start from scratch. Enough already.
The best thing the government can do for all of us is to stop wasting money and get the budget under control. When that happens taxes can be reduced and everyone will have more money to keep the economy running smoothly. Putting the financial crooks in jail would be a big help also.
The government should hand out lists of available houses and apartments for rent to all Americans who are trying to live beyond their means and can't afford their mortgage payments. They should allow the mortgage banks to take their lumps, without government bailouts, and take all of these houses back. Let the Law of Supply and Demand work for a change.
Over site the lack of it got us into this mess. that is the only thing that will get us out of it.
Jack, months ago I wondered who's pockets Palosi and Ried were indebted to when the financial bailout was first agreed upon. The government should have set up a department with those funds to assist homeowners being forclosed on and directly made available funds or assistance to these unfortunates. Most of us were under the impression that this was going to be the case. How gullible we are.
They should make the banks stop the foreclousers to some point. If you have been paying your loan every month and trying to do your best then help but if you have only been living in the place, throw them out.
Don't know. The gov't doesn't help people that cannot afford to buy a home. Those people have to rent. And when their rent goes up on a regular basis, the gov't doesn't do anything about that either. Why bail out "buyers" and not bail out "renters"?
I really don't think there is anything the government can do at this point. There is no way that the remaining tarp fund can pay for everybody's mortgage, and if we only help pay for some people, there will be a massive controversy about only some people being bailed out. I'm one of the people who still don't think the $700 billion bailout was a good idea, so I think government spending programs to help get the economy up and running should be the first priority.
Greed at the top got us in this mess...the home crisis has been the scapegoat. Just make sure money is put into credit funds to make loans and stop pacifying the greedy CEOs of financial industry. Future money should be for LOANS ONLY. If a financial institution can't manage their own industry why should we trust THEM with ANY money?
The REAL problem is at the TOP of the institutions so let's get THOSE corrupt idiots!
They should help responsible homeowners
If Obama can utilize the remaining $350 billion TARP money, then that money ought to go to mediating the banks and mortgagors into a compromised value that both can live with. This should help to mediate the toxic waste outstanding and to take assets of poor value off the ledgers of banks. In addition, set up a renter's option if such mediation doesn't immediately work so as to keep people in their homes. Homeowners can rent rather than be tossed out of their houses while banks do not accumulate unwanted lists of undesired properties. The faster, the better!
Home-owners who recklessly went for a home without the means to pay mortgage deserve to lose their home. No mercy on those who does not know how to take care of their finances and personal affairs.
I was told today by my local power company I couldnt go green and sell my solar powered energy to them. Guess laws on the books preventing me from doing this here in FL.
Strange how us homeowners are being hit with huge increases in utlity bills, you think they are trying to make sure when all this so called free energy gets here,, they can still have a job?
I know this is off subject, but i think its time CNN and others start looking at the costs and who is going to be the owners of the new Green resources, and why it is not going to be cheaper. In reality if every home had a stand alone Solar array and just sold its energy back to the utility power company during the day , we wouldnt have a utility bill, at night we dont use as much, Thus a gain for us homeowners. But if cost per KWH keeps going up then it will not be affordable!!
I smell green means bad news for us!! if not regulated and corruption stopped now.
Well, since our tax dollars are "rescuing" the banks and mortgage companies, doesn't that mean that we all (as a government of the people, by the people, and for the people) became partial owners of these lending institutions, and as such get to vote on their policies and procedures including interest rates and fees? I think if you an prove you paid your taxes, you are a "shareholder." I would bet that if it came up to a popular vote amoungst "shareholders", we would all be able to afford a house and mortgage payments.
What irks me the most about all this is that homeowners who lived within their means and paid their mortgages on time will get nothing from this, no reward. We deliberately did not move, we refinanced to a lower rate, we budgeted for our mortgage, and did not buy investment property....and are not included in any bailout.
People who live beyone their means should not be rewarded with a bailout. Any residences that are not a primary residence should be foreclosed upon for these people, and if they cannot afford their primary residence, tough bananas......downsize and start living within your means, YOU are part of the reason the economy is sucking wind.
I don't think the government should bail these people out, even though many of them were scammed, it was still their responsibility to do their own homework and the rest of us shouldn't be forced to pay for it. Why should I have to pay so these people can have homes they shouldn't have bought when I can't even afford to have a house for myself? Quick! Someone sell me a bad mortgage so I can have a house someone else has to pay for too! Some of these bad mortgage homes in California were even sold to illegal aliens! I think the scammer executives and management at all levels of these bad mortgage companies should be tried and jailed for crimes against humanity and their property taken away as paritial payment for the mess they have created!
What baffles me is that your hearing that people was buying home that they could not afford, when the majority of people that has had or is facing foreclosure did not buy a home that they could not afford but lost their jobs and couldn’t make the payments. Wall Street cronies would like for everyone to believe that the American people is at fault for over spending, and some did, but that just a smoking gun. The last time I check the bailout money is coming from the taxpayer. Who the taxpayer? Well some of these taxpayers are the ones loosing their house. How ironic is that? Your tax money is bailing out the same bank that is putting you on the street. The government needs to find a solution for that homeowner that needs help. Re-write the mortgages!!
Why should we use tax money to bail out the irresponsible who took on home loans that they couldn't afford.
What is the government going to do for the responsible ones who took on home loans that they could afford and continue to make the payment each month.
Because there are 2 parties. A three party system would not eliminate fighting but there would be a clear majority.
Jobs. The only thing that will save this economy is putting good workers back to work.
Artificially high-priced homes don't work. Look around. But there are many people, unemployed, on fix-incomes,etc, who need to extend their mortgage on the back end by a few months, reduce monthly payments and help them get back on track. What's so difficult about that?
The government should help homeowners by banning bad lenders to conduct similar business.
Yes! We have women and children living in cars and on the streets – SHAME ON AMERICA. We can save a third world country, but we can't help our own – when do we stop this insanity and realize we are responsible for our neighbor...
A lot of people do not get it. THE BANKS WROTE THE LOANS to people they KNEW could not pay for and KNEW were not qualified for the said loans. They would even help them lie or stretch the facts with regards to income etc. The money was in writing loan after loan and bundling said worthless or sub prime loans and selling them to your mutual fund of 401 k fund. Thinking being that there was big money in buying these loans what B S. Help the people suckered by these shyster bankers, all they wanted was a chance at a nice house, it was offered under shaded circumstances they probably knew nothing about. And how could you turn down the chance just one time, for a moment to have a nice place to call home. GREED by the financial markets what else is there to say....
By teaching them the consequences of borrowing for profit. For that is exactly what it was.
This duty does not fall to the government, Jack, beyond the Fed keeping the interest rates low. It is up to greedy homeowners who bought for a song back in the "boom times" and now are trying to resell at 3 or 4 times the amount they bought for to lower their prices to affordable levels. I live in Las Vegas and every time my husband and I look at a home for sale, I go to the county assessor's office online and find out what the current owners paid for the property in question. Nine times out of ten, these folks bought for a song back in the mid-late 90's and are now trying to recoup plenty of times over. Add to that the fact that greedy realtors are telling these sellers they can sell for rates that amount to usury and at the same time encouraging buyers to become "house poor" and the problem takes on new dimensions. Greed is the problem, Jack, and while the government has its own problems in that regard, it can't be held responsible for the irresponsible decisions made in the real estate business.
They should have send us that 700 billion dollars. We would pay mortgages, go shopping for holidays and save some money too. The problem would be that all the fat cats would complain that this is socialist. When we trow big bucks at the big business did not help economy.
We cannot afford to see a dramatic decline in home ownership. Ownership in something reduces crime rates, increases the tax revenue that funds even our most basic services (police, fire, medical transport). The government needs to intervene lest we all end up without the proverbial "pot to pee in"
All Tax tapers should get a $100,000 bailout check, will cost less than giving money to banks.
Hey Jack. I'm not greedy. I'll take $169,000.00 thank you very much. And then I'd pay off my mortgage.
The Government should offer a serious Mortgage writedown and mortgage mitigation program; including allowing people 12 months of paying PRINCIPAL ONLY and the ability to lower interest rates to 4% across the board.
It is easy to feel superior if you are not one of the people affected, but the truth is, we are ALL affected by this mortgage/housing crisis, and only the banks and Fat Cats are being bailed out.
Help us and we will refloat the economy. Thanks Jack
The $350,000,000,000 should go to the homeowners, small business and new business growth!
I think the government should do nothing to help the homeowners. After all, it is the people's own fault that they got into a mortgage they could not pay for. Why should the government go further into debt to bailout their mistakes?
The government should buy all the homes, then rent them to the current occupants who would then have the option down the road of refinancing. It would bring revenue back to the government and keep people in their homes.
Jack, There is no easy or simple answers to this question. I do believe that something must be done to stop the 'bleeding' before most of these families end up either on the welfare rolls or out in the streets with nothing to show for all of their efforts and hard work to attain homeownership. On welfare they will be maligned by the Right and being homeless they will be ignored too.
why should they help homeowners - they do already by tax relief
renters dont get any help
why help stupid excessive homeowners
No idea why they help banks either - would they help companies like Intel if they needed it?
Housing prices were inflated because virtually anybody could get the money to buy anything. There was no real limit in housing prices as there would be if purchasers had had to prove their ability to pay, and qualified purchasers wouldn't have required subprime mortages with skyrocketing payments. And conversely, people who might have qualified for a real mortagage at a lower price had to take exotic mortgages to be able to buy at inflated prices.
So the answer is, the government shouldn't do anything. Housing prices can reach more realistic levels that more qualified people can afford.
It's time to give homeowners funds so the banks don't have to foreclose on the homes.
The banks are failing because we don't have jobs, not because the banks don't have business.
The government should re-finance mortgages based on the current value of homes. The situation of homes being worth less than the payments being made on them will continually be a drain on the economy. People will not spend money on home improvement, automobiles, vacations, or other non-essentials because they will be primarily focused on paying down their mortgage so they will eventually be able to sell their homes. This problem is worse for new homeowners, who tend to be young and usually purchase a 'starter home' that they plan to sell in a few years. These people are now sitting in homes they feel they will never be able to sell – at least I am...
Force the banks to dramatically lower interest rates....just like the Federal Reserve has dramatically lowered the prime interest rate that allows banks to borrow cheap money.
Over the past two years I have watched the Federal Reserve cut interest rates quarter after quarter in efforts to jump start our faltering economy. But from what I understand this is simply another example of putting Wall Street before Main Street. These rate cuts allow banks to borrow cheap money and “supposedly” the benefit of that will eventually trickle down to Main Street. I don’t know who came up with that logic. The goal on Wall Street is to make money, make more money, and make the most money. Wall Street WILL NOT help Main Street simply because the Federal Reserve helped them. They will make as much money as they possibly can off of those rate cuts with little or no regard to those on Main Street. The Fed has cut the interest rate to near an unprecedented zero percent! Meanwhile mortgage rates are still above five percent and it took a while for them to get that low! Where is the fairness? When the Fed first started cutting rates I thought if they want to jump start the economy why don’t they force mortgage rate cut? That would definitely jump start the economy. But oh no! We can’t put the interest (no pun intended) of the majority of the American people first can we? Of course not, that is just not the American way.
Banks aren't giving out loans because of risk but I'm still getting credit card offers daily for 23% interest. They took our money and are laughing at us. They are up to the same tricks that got us into and robbed the middle class
HAY Jack that Default Swap Scam the Bank Loan and Insurane Co. pull oon all bower to paint a pretty bowering picture is all the cause.Those Loan Sharks Should be put in Jail!!
Who ultimately decided to bail-out the Texas savings & loan industry in 1989?...Texan, and newly elected president, George Herbert Walker Bush. Who payed for it?...every US taxpayer. Guess the Bush's are just in the right job at the wrong time.
They shouldn't bail-out these people. I didn't buy a house because I could not afford to be a homeowner. Is someone going to give me thousands for making a responsible decision? How about giving responsible CEO's bonuses? Sounds crazy, but crazy is what we are talking about doing.
I am a renter. How is the government going to help the millions of families like mine, who were smart enough to know when we could not afford an overpriced home in northern CA? Where is my handout? Would the government be willing to help families like mine to make a down payment on a home that is going to be foreclosed on? I would love a hand out, too? No really, my husband and I are doing it the old fashioned way. We are saving for the 20% down payment and looking for a reasonably priced home. We are not willing to spend more than 30% of our income on our home. We have seen first hand how people who buy over that amount are struggling and now are in foreclosure. How fair is a mortgage bailout to those of us who wanted to wait before buying something we knew we would not ultimately be able to afford!
bailout after bailout except for the people who really need it. Bailing out millionaires and billionaire don't they have enough money.STOP PLAYING GAMES AND HELP THE HOMEOWNERS BECAUSE THE BANKS AREN'T
Help the homeowners? Absolutely. Help ALL the homeowners. No bail out for people who can't keep up with their mortgage payments unless you offer the same deal to all those who have beg, borrowed and starved in order to keep making making payments. There are already too many homeless the the land of the free and the home of the brave. The government must do what it can, to keep people in their homes, but the deal is for all the good guys too.
C'mon Jack, this is easy and I'm an idiot. First put everyones payment back where it was when we were all paying our mortgage. Second, tell the banks to take partial payments. I mean if I owe you $6000.00 and tell you I have $4200.00 you would take it right ? Well the dam bank wont and then wonder why there are so many forclosures. DUH.
The government should use the bailout money to make mortgage payments for homeowners! Every home in America gets 6 month's worth paid. The money goes into the banks, where it's needed, but helps the American people at the same time. Homeowners get a 6 month break, can spend some of that money elsewhere to stimulate the economy, or use it to build a fund to make mortgage payments down the line. I know it's not fair to those who don't own homes, or those who have homes that are already paid off, but if we save the economy it helps all of those people too. USE THE MONEY TO HELP PEOPLE, NOT BANKS.
Yes!!! The goverment can pay off my mortgage and keep the house. I have tried to sell it for over 2 years without any luck. I am willing to give the house away for what I owe on the mortgage. I am one of few American homeowners whose home is worth more than what I owe on the mortgage.
Give each household in the United States $250,000 of TARP funds. Assuming there are 100 million households, this program would cost $25 billion or less than 10% of the TARP money spent so far. The resulting stimulation to the economy should have a far more dramatic impact than the existing program which seems to be limited to providing money to big banks to buy smaller banks. Families would be able to pay off mortgages or at least negotiate better terms.
Most of these defaults are caused by huge increases in payments because of ARMs many homeowners were talked into by lenders. The lenders are going to lose anyway ~ why doesn't the government require them to renegotiate with current owners who have exhibited an ability to pay and a record of doing so. If they foreclose they will then have to list the house at the current market value ... and lose an additional sum by paying realtors their fees. They would lose less by renegotiating with the current owner and many families will be able to retain their homes!
What if the government had put all of this money directly into the hands of those primary (no second or third investment houses) mortgage holders? By my very rough math, that would have resulted in about $20,000 per potential foreclosure.
That would have helped home prices by putting fewer on the foreclosure market, and would have helped the credit market by ensuring banks were getting paid back.
Instead, the shareholders and "C" level execs have been bailed out.
They need to do what the President-elect has been advocating. Instaed of forclosing and not haveing a market to sell these house, renogotiate the loans, based on there present value. The goverment could then garrentee these loans on 30 year fixed rates only. The loan companies would have to pay a price for their bad judgement, the homeowner would keep the house but have to pay a fair price for it and the taxpayers would be less likely to have to pay a large amount. This could actually be done without a large amount of upfront money, just renewing contracts.
I'm no guru of finance but here's a simple view of things.
If we bail out Wall street but lose Main St. there's no one left to even worry about whetewhr Wall St even exists!
Bail out Main St. and Wall St. can come back on the strentgh re-gained on Main St.
Those who lose because of greed and under handed trading lose.
Those left at the end are the ones who invested and traded wisely and should be the ones we would wnat there anyway!
I live in a small frame house that I knew I could afford. It is now mine. Why should my tax dollars go to bail out idiots who bought well above their means? Fiscal responsibility begins at home.
I do think any homeowners who lost their homes due to changes in their job status should be helped, but as for those who made poor decisions and chose to live above their means, they might be better served by folks like Suzie Ormond and by learning sound economic and investment principles.
Any bank getting a handout from the government ought to be required to renegotiate mortgages so that people can afford to stay in their homes. They'd have some honest money coming in, houses wouldn't be standing empty and dragging neighborhood property values down or being stripped or vandalized, and people wouldn't be trying to work and raise their families based in their car or a homeless shelter. They ought to think of the country first for a change. And the ones who used their bailout money to buy other banks? Damn them.
I say no way. Those people got liar loans, got caught and now want tax payers to pay for it.
Had the billions been distributed to the people instead of the robber baron executives the problem would be much less severe.
This is the key to any economic recovery. House prices will never stop falling if they don't stop foreclosures. Here's an idea: Take a meager $350 billion (TARP money), start a brand new bank that will lend to consumers, including mortgages. It would be well capitalized and would serve the taxpayers that have funded it. Let's stop throwing our good money after the banks' bad. Let them go under and take all of their Wall Street cronies with them!
Colin in Phoenix
Jack do you think you can get them to pay my mortgage. I earn about 160k a year and I bought a 120k house. My mortgage is 900 a month. I need help too. I was stupid and lived within my means!
I must be missing something – this seems like a fairly straight-forward problem. Why not lend money to whatever financial instution which holds the "foreclosure" rights to refinance mortgages at a fixed 30 or 40 year low rate, such as 4.5%, WITHOUT reducing the principle amount. It is an investment and, hopefully, over time – the mortgages will rise "above water" again. It is a much better solution than foreclosure and will help slow down the reduction in home values and doesn't 'punish' homeowners that have been able to keep up with their mortgage payments either. This doesn't seem that difficult to me... if we don't stop the foreclosures, the economy cannot recover. So find a way to keep people in their homes that benefits both the financial institutions and the homeowners. This type of solution has been recommended by several economists... why do we have a government that seems paralyzed by indecision when that in itself is costly?
I think the government should bailout homeowners, not the bank. I have two adjustable mortgages and I contacted Washington Mutual to help me. Their response was, "The only way we can help you out is if you stop making payments to your mortgages". This is not fair, since I have paid my mortgages on time every montyh. Now, I am going to do exactly what they told me to do. No more payments!!!
I think the $500 BILLION given to the banks, without having any accountability, was the DUMBEST thing our government has ever done! All this did was put more money into the pockets of the RICH BANKERS, and did ABSOLUTELY NOTHING to help the people who have lost their homes! I, lilke most tax-paying citizens, have lost MOST of the money that I have put into mutual funds and TDAs for the last 25 yrs. Now it looks as though I will never be able to retire, whereas the RICH BANKERS & CEOs in this country continue to reep MILLIONS!!! THIS IS NOT THE WAY TO KEEP AMERICA FREE!!!
I am one of those people that will lose my home.
I had to take family leave to take care of my dying husband.
I used our savings to keep bills as current as possible until the savings ran out.
Well I lost my husband and then found out I had been replaced because I was on family leave too long.
I do not expect people to feel sorry for me but for the goverment to help me out - I do not have income at the present except for my SS what hope is there- To everyone else- dont wait for a goverment bail-out although I believe Obama will try- do anything you can before its too late like me.
please do not use my name on the air
Jack I think the Federal Government needs to allow people to withdraw their money from IRA's and 401K's etc. without the 10% penalty for withdrawls prior to 591/2 and to wave the federal income tax on these withdrawls. Of course the withdrawls must be used to pay down or payoff the mortgages. These mortgage payoffs will also provide the banks with the needed capitol with no taxpayer bailout money.
Jack, Yes I think the government should bail out home owners. Look, there are home owners out there that have done everthing right and are still in trouble. These are the ones that should have help. Then there are the ones that should never have been allowed to buy in the first place. The home owner should get the help before the banks do. The home owner drives the economy. The banks are taking the money and buying more banks or giving out bonuses to execs that should be in jail instead of making more millions of tax payer dollors.
One of the best ways to stimulate the economy is for the government to put more pressure on the mortgage industry to provide affordable, i.e., less greedy mortgages to homeowners. People don't spend if they are fearful of loosing their homes. Bank of America bought Countrywide, which admitted to loan fraud and they were quick to get a government bail-out, including another 25 billion today. It is time the homeowners received their portion of the bail-out and not the wall street fat cats to trickle it down.
Foreclosing on homeowners whose homes than become vacant and attach crime is not the answer. You want those people in there to protect the property and neighbors property. Refinance at lower interest rates and longer terms. HUD buys homes if necessary and does same. Create inflation in economy by massive military equipment replacement from war loses. Military spending is inflationary by definition (increase in money in consumers hands, no product to buy; you can't buy military goods = inflation). Ralph, Yakima, Wa.
This is simple , Jack! OBVIOUSLY pumping money into the Banks failed miserably. In Fact, we don't know what happened to that money. The problem is houses cannot sell for enough to pay off the mortgages, right?
Then a Government imposed sanction that makes banks lower the mortgages to their appraised values.
If the Banks don't have the sense to negotiate in order the make a little money over,NO MONEY, then the Government must step in. Banks have screwed the American people time and time again and can't be trusted to do the right thing, it must be done for them!
Of course common sense will always be overturned by Greed!
with the govt bailing out everyone but the home owner with million and billion dollar packages wheres that leave the homeowners in foreclosure. no where! exactly. let obama make a statement, take the first step from day one, use his 160 milion dollar price tag for his inauguration and apply it to the helpless homeowners facing foreclosure.how does one justify such a price tag for a party anyway?
The federal government should not bail out either the homeowners or the banks. Instead, there should be an agency set up to mediate between homeowners and the banks. This agency could possibly lower their interest rates to the rate of inflation and to extend their mortgages so that they can afford the monthly payments for their homes. For those that can still not afford their homes, they should be allowed to sell their home at current market price and pay the banks what they get, and the rest should be erased. If banks can get a $700 billion bailout, I think regular citizens deserve a second chance, too.
Dan in Georgia
This one's really easy; the 350 billion plus that the Senate just approved could be placed in equal amounts to the states where homeowner/taxpayer bailouts are truly needed. And on an individual bais (actual need, not just giving a blank check to the people that put us in this mess in the first place), the money could go directly to the homeowner/taxpayer that really needs it .
Immediately establish a six-month forbearance period and moratorium on foreclosures for ALL homeowners. This will give the one-tenth that are behind time to make the necessary life modifications to catch up and resume regular payments. It will also stimulate the economy by putting six months worth of mortgage money in the pockets of the nine-tenths of homeowners whom are caught up on their mortgage. We need to think big.
1. Exhort banks to IMMEDIATELY suspend ALL home mortgage payments for a four to six-month "forbearance" period, pushing back all final mortgage payments four to six months (e.g., from January 2034 to July 2034). For example, if you are caught up on your monthly mortgage payments, your next regular payment would be due on 1 July 2009. If you are behind on your monthly mortgage but not in foreclosure, the amount you owe today would now be due on 1 July 2009.
2. Exhort banks to IMMEDIATELY establish a moratorium on ALL residential foreclosure proceedings for the same four to six-month "forbearance" period (including those homes that have yet to be sold by the bank, which could help get some people BACK in their homes).
3. Use the remaining $350 billion bailout funds to inject capital into
mortgage-lending banks proportionate to their market share of active home mortgages to cushion this "housing correction/economic crisis-adjustment grace or forbearance period." Mortgage lenders should be willing to accept any temporary inconvenience this may cause because, as whole, we all contributed to the housing crisis. In the long term we all could be better off.
Nothing ... they have already done something. Government policy and banking greed have already made a mess of housing. Tighten credit and rules and follow them. It will work by enforcing self-discipline!
put a freeze on homeforeclosure and have banks and individuals renegotiate their mortgage payment and find a way to have fixed interest rates for a few years until people get back on track in having training and or work and paying down their own debt i.e. credit card (it would be done faster if interest rates were lowered on credit card and banks would atually get paid back and this would reduce personal bankruptcy rate). Wall Street needs to accept responsibility for creating this bubble that has collapsed which created in the process situations where lots of people's own bubble has also collapsed; how does both sides take responsibility ? People need to relearn to create a relationship between Wall Street and Main Street since it was absent to begin with...and for this to happen successfully, people from both sides needs to stop treating each side as being stupid and since spending all the tax money to get everyone out of this crisis it should be done with the understanding that people deserve to be treated and treat each other with respect, intelligence and with sharing real knowledge of what is being done exactly in order to never repeat the same greedy bubble mistake of living beyond our means and forgetting not considering what we have done or let done to ourselves and to our neighbors ie. community of people destroyed and companies looking to survive and banks dependent on government and government representing people from communities, companies and banks!
It took years to create all of these bubbles and we should expect it will take some time to learn from this collapse. But if we learn lessons quickly we can actually come back up quickly and create a renewed relationship of all parties. No more overfeeding our world of empty calories! In other words, the market cannot expect the same solution that keeps reocurring of spending in filling our homes...we need spending in improving the lives of people through real state projects, national projects and education!
That is why it is up to government to take the lead on fixing the mess if they can work together in knowing that they are there to protect our freedoms but also to show that with our freedoms comes real responsible actions! Believing in free markets also requires believing once again that markets are to be responsible to people of their decisions!
Bring people back into their homes, renegotiate reasonable mortgage in order to bring back communities back to life and add new value to that life...a moderate value!!!
Perhaps we could slow down the foreclosures a bit if these banks would recognize that their real relationship with their borrowers is that of landlord, not banker. It would also make sense to do whatever it takes to keep these homes occupied preferably with the most recent homeowner. They could charge a modest rent and give the homeowner / tenant the right of first refusal should a buyer be found.
Drag the garbage responsible for creating those toxic mortgages out of their penthouses and mansions and hang them in public. Unfortunately with the judicial system, particularily in New York, these guys will enjoy the fruits of their ill gotten riches without every paying any price for the people whose lives they ruined
I believe that some of the homeowners deserve to go bankrupt.
However some homeowners who are Genuiely need help and the program needs to help just them only and should be designed to do so.
I dont believe any of the money should go to banks as giving them money is not passing onto local Joe who needs it. They are using that money to keep their balance sheets strong. Giving first 350 billion hasnt done anything yet.....
Jack, Forget bailing out the big banks and buinesses! It's time for trickle UP economy! If they devided all those billions between the adult CITIZENS of the United States, most of us would be able to pay off/down our debts and have money to stimulate the economy our selfs. If we all paid off our credit cards the banks would then have lots of money to lend out again! how much would we each have gotten if we divied up 750 Billion!!
Lynn Penngrove, CA
How about a one-time stimulus check of $25,000 to each homeowner that is not in a sub-prime loan. With the stipulation that the money be used to shore up debt.
It would be faster and cheaper than letting the banks buy more banks!Have a great weekend!
While I believe in the core functions of free market principles, it is simply socially unacceptable to bail out big business and then let homeowners rot. While ignorance is no excuse, the deception that was afoot is mainly to blame.
1. Every owner of a distressed property would be required to meet with a financial adviser to determine what financial burden they could bear.
2. If the mortgage was written by any bank that received TARP funds, the interest rate for the mortgage would be directly linked to inflationary numbers; no profit.
3. Working with these numbers, the moderator would create a new mortgage (or determine the owner cannot afford the home) that would be guaranteed by the government. Defaults would result in automatic criminal negligence charges (or something similar).
This would also create rock solid mortgage packages for investors to buy stock in.
Not perfect, but sounds a lot better than massive bonuses, parties in Aspen and corporate jets for my tax dollar.
The value of my home is down but the property taxes are still the same as they were when the house value was higher. The city is not even talking about reassessing the value of the properties in order to bring the property taxes down to the reasonable amount they should be.
Over 50 BILLION is still unaccounted in Iraq and Obama needs to go after the people that stole the money. Then cancel Limbough's contract because he's just spreading Neo-Con Ideology to the American military. Then investigate the governments subsidies going to FOX network, in violation of Federal laws. After that, Halliburton hasn't repaid the fines levied for over billing DOD. The list goes on and on and all Obama needs to do is follow the money trail.
i think this is a no brainer to fix, instead of giving the banks and other finacial instatutes trillions of dollars, just divide it up to all homeowners they will use it to pay off there morgages, car loans etc this will put all the money back into play and ......... puff the economy is on the upswing , i dont know exactly how much each american family would get, but it would be substantial
I think the government should help troubled homeowners by allowing them to renegatiate their mortgages. I also think that interest rates on personal loans should be capped to prevent gouging the consumer in these tough times.
If the government would lower the home loans,homes bought between 2005 and 2007, by 20% that would really help the economy. I live in Phoenix and many homeowners in my area who can afford their mortgage payments can't do any other spending because the decrease of home prices has really scared them. I feel something like this is the only way to build confidence in the economy.
IF those who are facing foreclosure are in that situation because of job loss or catastrophic health issues, then let's get them back on their feet and keep them in their homes. That's the social safety net we should uphold.
However, if they are just not paying because of upside down mortgages on houses that they paid too much for in the beginning or if they did not read the fine print before they signed on the bottom line and are now unable to pay because of ballooning interest rates, then I have very little sympathy for them. It's not my responsibility as a tax payer to subsidize stupidity. I realized back in 2002 that something was wrong when I would have qualified for a $450,000 mortgage on a salary of $33,000 and student loan debts of $15,000 – and when I read the fine print in the newspaper ad, I ran from the possibility of owning a home as fast as I could. If I could figure it out, everyone else should have.
Bedford County, Pennsylvania
The government should and must help out homeowners, after all it's the home owners that are the ones bailing out everyone else. The bailout is from (homeowners) our tax dollars. Unless we start getting stock issued in the companies we are bailing out, the bailout to companies are actually steeling.
Taxes where designed to pay for the infrastructure of this nation, not bailing out companies that do not know how to run a business, not willing to give up there jets and defiantly not for paying out bonuses to companies that have not been profitable.
The government should not bail out the homeowners with money. What they should do is make banks extend terms and set a fixed rate in order to make monthly payments more affordable for the homeowner. This will allow people to stay in their homes and not cost the taxpayers anything.
I honestly don't think the government should be stepping in to help anyone. Where does it end?
We are military and own a home in one state and live in another. We have a tenant in one home and I have to work to pay the difference between the rent and mortgage (and pay the entire mortgage when the house is empty, which is a struggle at times). We can't sell the home because of the difference between the pay-off and what we could sell it for. We do what we have to in order to keep from going under.
If the government helps those who don't where is the incentive for those who do the "right" thing? Other than keeping our credit in good standing (which is very important). So the gov't bails out those, but we are still left struggling to pay a rent on our current residence and mortgage on the other.
No, I don't believe that the government should bail out homeowners. Our deficet is bad enough. Plus the big bail out plan for businesses. Where does it end?
The government should buy up these foreclosed loans with TARP funds and immediately demolish the houses. This would keep the foreclosed homes out of the glutted housing market which will slow the downward spiral of housing values in these over built markets.
I think it is all the real estate agents and boards who are to blame. They decide the price of home. There is no regulation for how much a home is or should go up by every year. When a home doubles in price in under 5 years there is something wrong with that. Our incomes do not double, if anything we've been asked to take decreases in our incomes. Our parents in the seventies paid 6 times a yearly wage for their homes. Today we have to pay 36 times our yearly wage to own a home, and that is for a condo not even a house with a yard.
Why does nobody ever talk about the real estate board?
STOP ! All lending institutions should have to give each foreclosed homeowner the opportunity to pay off their homes at the ORIGINAL terms agreed to when the loan was purchased.
Revert all ARM and other increased rates back to something these homeowners can afford. or NO government monies.
Hey lenders 4 % is better than nothing.
I believe the government should crack down on banks and loan companies and put caps on the interest rate that can be charged. Also I think instead of forclosing on individuals the banks and loan companies should be required to re-write the loans which would bring the people current and base the payment on the amount of income (a certain percentage). The banks and loan companies are out of control with these adjustable mortages they suckered most people into.
Debbie – Franklin Furnace, OH
I've said this from the very beginning, 'Give us the money'!!!!!!!
We will pay off our morgages and probably buy a car. The money will go to, Oh my god! the banks and the car companies! We will be out of debt and, Oh, my god ,so will they!!!!!! If they want the money , they have to start with the consumer.
If AIG, BofA, and two of the big three deserve a rescue why not the homeowner. Especially those, like me, that took their equity to pay down or eliminate outstanding debt rather than run from obligations like some many others have done. The TARP money should be used to adjust these and my mortgage at a decent rate of interest. Without fees.
Under the fractional reserve system it is inevitable that what we are seeing now in the economy occurs. Money can only be created out of debt and with the application of interest it means there is more money owed to the federal reserve/banks in general than there is actual money! What the government needs to do is completely rework (or abolish altogether) the monetary system. But too many people in high places are making too much money to ever change willingly...
The government should use some of the remaining bailout funds to help homeowners who owe more than their house is worth and can't sell them by giving principal reductions. It's the only fair way to reconcile the housing market without more people losing their homes.
The banks are receiving all kinds of cash from the bailout and getting the houses seized in foreclosure.
The homeowners in jeopardy could pay first year up to 100% of mortgage payments and it would go against principal (first two years they could pay no less then 50%). Second year 80%principal 20%interest, then 60% 40% and in year 5 it would end. The interest deferred could be either forgiven in part or whole and added to the sale price or paid over the next 5 years. Many people could stay in their homes. Banks would not have to write off or foreclose these homes. The banks would have cash flow. There would be no violation of contract law. Most people would see they would build equity past point of mortgage quickly and since going to principal it would lower their payments in future years. Since there would be no interest deduction on tas returns the government would actually have increased revenue. All of this could be put into a simple plan offered nationwide to those whose equity value was less then 10% (and obviously negative). Property could be appraised and major penalties for false appraises.
they signed the mortgage agreement they should live up to their end of the agreement. let them lose their houses. shame on them. if you couldn't afford the payment you shouldn't have bought that house. people who pay their mortgage every month and on time don't need to foot the bill for people who are not smart enough to know when they are in over their head. shame on the government if they bail these people out. sometimes i believe we need a new system of government with rules that hold people accountable for the mistakes they make. no more money for anyone. how can we pay down our debt if we keep exploding it to numbers i can't make my calculator reach?
Use the Bail out money for extremely low rate mortgages. Lend the money out at 3.5% 15, 30, and even longer terms for borrowers in trouble. This will lower payments For those not in financial trouble this will put a lot of money in peoples pockets then they will spend more, for those in trouble this will give them a second chance, and for the banks this will bring in fee income, new loans to bundle and get appraisers, lawyers and title co's. working. Plus with the extra cash people will have there will be more home improvements.
Low rates will also stimulate home purchasing.
My wife and myself, like millions of American homeowners, are now the proud owners of a home that's worth less than what we owe on our mortgage. We have a 6.5% fixed rate mortgage. My wife lost her job last October. We have managed to keep paying our bills, but it's an uphill battle and our savings are gone and our checking accounts are dwindling. With interest rates on 30 year fixed rate mortgages now running 5 – 5.5%, it would be great of we could refinance, which would save us up to $500 a month. But, because of the Loan to Value ratio (with us being upside down on our mortgage), there's no way we can refinance, even though both my wife and myself have credit scores above 760. The government should make it a requirement that lenders lower the interest rates on mortgages that are in good standing before the borrowers get to the point that they can't make their payments. This could help curb future foreclosures which will wind up costing the lenders more money.
I am a mortgage loan officer in "The Blagojevich Territory" and have seen the ups and downs with this industry.
First change I would make is to stop blaming these families for buying something that they could not afford.
The mortgage company had a mortgage for them, and of course like a kid in the candy shop went for the Hershey bar instead of the Hershey kisses, because they were told they could do it...no problem...
The realtor and mortgage loan officer had their job of making the deal "work" and the attorney for the buyer had a responsibility to explain the loan aspect to their client. But they dont do it...what about going after these attorneys that just throw the closing documents infront of their client with a minimual explanation of what they are getting into. Isn't that what they are paid for?
Second, these mortgage companies have done nothing but made the situation worse by adding pricing hits of the loan for credit score and loan to value, etc. Making it harder for loan officers like me to help families get off of these ridiculous loans
None of this is going to change unless these mortgage companies get off of their ^%$ and start dealing with the real problem
They are the problem and unless these foreclosure are stopped nothing is going to change and you can thank the mortgage industry for that!! Greed is greed no matter which way you cut it!!
If you want to help all of us homeowners then you must wake up the banks. If you are underwater with the value of your home WHY would continue investing in it. Real estate is simple. You buy low and sale high. Well that does not exist anymore so if your credit is great and lenders won't lend then your stuck and if your credit is challenged then your stuck. Without buyers and sellers how is the market going to change. Banks have to be willing to accept the current appraised value of a home so that those who want to keep there home will not only stay but be able to pay. With monthly interest + property taxes you generate revenue and with homes at a proper value then your stimulate the real estate market.
Its simple. For those of us who will carry the brunt of the massive tax burden that the bailouts will leave for us and our children, give us a bailout. Buy down our mortgages, pay our college tuitions, leave us with the ability to carry this burden and we will, as we always have.
If we are going to keep giving banks bail-out money, why not activate a 5% interest rate on every loan, mortgage, auto, credit card, business, etc. This would stop foreclosures on these insane ARM mortgages and actually free up money for auto loans and give the consumer some breathing space. Greed created this mess, this simple adjustment would even save the banks. This is probably to simple.
The Government should pass laws to put the bankers in jail for the fraud and greed that got us here in the first place. Giving loans to people who can't afford them and then selling them across the globe as an asset is no better than what Bernie Madoff did. Remember, this is a global problem not just an internal one.
Just think of all the corrections jobs that would be created.
I don't think there is anything anyone can do; greed runs this country from the lobbiest in Washington, CEO's , and Big Business.
All we can do is sit back as the words of Ross Periot linger in the background, "The Sucking sound of jobs leaving this country." Its Nafta Stupid.....
This is the easiest question I have ever been asked.
Quit outsourcing all of our freaking jobs. Put a tariff on all the imports and disperse the funds equally from the tariffs to all American citizens. Then kick all the illegal non-citizens the hell out of hear. Last but not lease, prosecute Bush and Channey for treason. Any or all of these idea's would help.
P.S. If you give the banks bailout money it will just go to the rich to buy up the foreclosures, I believe they are called bottom feeders. This happened in California before, because of one of the Bush brothers.
We can help the homeowners and businesses by ONLY building new structures ONLY within current built areas or cities and not creating new infrastructures ..like new roads and areas which require new utilities etc...rebuild only within areas which already exist. We must utilize the land and spaces which already exist before we start creating more infrastructure. Bring the same people back to their original homes with new mortgages at lower interest rates ...as long as they can afford the new mortgage. Put them back inside their homes and make them pay a lower monthly fee....
House prices were too high which caused this mess. If the government will not intefere with the foreclosures the housing prices will fall to a more realistic level. Everyone would be able to buy affordable housing. Most foreclosures were because buyers were buying homes they could not afford. Housing cost should never be more than 2 1/2 times yearly income. Let the market dictate price not the government which is out of touch with reality and has not truly represented the people in more than a decade.
Normally I would say no to homeowner bailouts, but, there were wolves out there. Bush let Wall St. send the wolves. Greed is the new motivation in America. Unlearned people thought this was their chance to get rich or just their piece of the pie. Real Estate agents, Wall St. Ect. cheered them on. A suicide type of Russian roulette, and the Feds just sat back and let it happen in the name of free enterprise. The wolves got rich, the dumb went to slaughter, and the rest of us are left to clean up the mess. With all eyes on an illegal war the wolves came in the back door. Follow the money to get the truth.
Great work on the housing issue. Your comments today are right on the money. As a homeowner in good standing I am concerned that if I had to I could not sell my home without financial ruin. Something must be done to adjust mortgages to real value.
Your show today gave me hope.
1) Immediate legislation to update the Truth in Lending Act of all the newer loan programs now available (ARMs). This is critical!
2) Force Banks to send a true disclosure letter out explaining their current mortgage and future impacts (some homeowners are unaware they have an ARM thanks to the Loan Sharks, excuse me, the loan officers).
3) Identify why banks/lenders would rather take a 50% loss or even higher on a home after foreclosure as opposed to renegotiating the terms of a loan. Then act upon this information.
4) Finally, stop the process of bundling up and selling our mortgages on the stock market.
5) Only give out the final bailout dollars to banks who are offering interest rates that are in-line with the Federal Reserves Rate of .25%. Mortgage rates are around 4.875 which is still a little high given the rate charged by the Feds. Banks are presently gouging.
No foreclosure bailouts, please. Just make banks start lending more to qualified buyers. People losing their homes shouldn't be in them to begin with. They had bad credit or no money, yet, still received loans.
Let them go back to renting. There is nothing wrong with them losing their property, it is not like they become homeless. If anything, they get free rent for 6 months to a year, albeit with a much lower credit score.
Let the housing market correct itself so that people who should be able to buy homes don't have to pay for artificially inflated housing prices due to the influx buyers that never needed to show any proof income to acquire loans. Once we hit normal levels for homes, the country can forget about this mess that the bank got us into.
I predict we see housing prices drop to about year 2000 level before the healing can begin and housing markets increase at a more normal 2-10% per year. The lower income areas are getting near but the premiere neighborhoods still haven't even come close to starting a decline into a more "normal" value. Once we see those neighborhoods follow suit of the less desirable areas, the market will be ready to trend back upward.
We need to do three things. 1. make more jobs. 2. put late payment on the back of loans. 3. make the bank drop the intrest rate to 3% or less, for 5 years or less. Some money is better than no money and as you can see we need the people who are losing there homes to shop. So this will allso put money in there pockets that we know thay will spend.
Help me, Jack! So I, like millions of others, have an upside down mortgage. And like millions of others, I was hopeful to tap into the BILLION$ in TARP funds that banks have to refinance to a lower APR. I have a 750+ FICO score, never delinquent on my current mortgage, nor have I ever declared bankruptcy or have had negative credit reporting. I'm a mortgager's wet dream. So, why can't I refinance? Well, my home's value went from an appraised value of $710k two years ago to around $445K today... and from the same lender! Where's my bailout? And can I now dispute my tax value from the assessor's office and lower my property tax? Why don't you call my lender and assessor and set them straight. You're one of the few who would scare the snot out of them. Any advice?
I believe a solution would be for the government to use the remainder of the money to bail out the people. If a house goes into foreclosure and is sold for less than the mortgage the government should make up the difference allowing the people to recover. And why is it that my tax dollars would go to bail out a bank who made a bad loan to begin with they knew what they were doing. We have seen how the banks have done nothing to assist and just used the money to bolster their financial position. After all I think the first three words of the constitution says "we the people" not "we the banks"
Hey Jack, I thought the whole point of the bailout was to help banks so turn they could help homeowners. Home owners have unfortunately been lefty to creat their own bailouts through loan modifications and working out payment problems with lenders. In some cases people have been waiting for loan mods for over three months lenders are backed up with borrowers looking for help. The Federal govornment could help by giving citizens tax vacations, mortagage vacations and tax rebate checks. If the congress and the senate cant with the pesident figure this out then we are all in trouble. The country has been mis managed and we are headed for very tough economic times if we dont react properly soon.
Can someone tell me what the $750 Billion dollars is divided by the number of "family's" there are in the US. Say 3.5 million families? I can’t find a calculator that will go that high. Really!
And how much money would each family get if we just GIVE IT TO THE PEOPLE. Would they have enough to pay their debt and go out and SHOP!! New Car …etc. Pay their late mortgage payments…Get this economy going??? Maybe we could bail ourselves "and" the big 3 out…
Couldn't this more fairly distribute the money, rather than pay those that have already lined their pockets and/or those with golden parachutes “that took our white parachutes away from us”!!
But I am sure there is some legal reason that this wont' work...?Right? The simulous package was only enough to make it laughable.
The real problem is all the innocent families that didn't refinance to buy a bigger house. The ones that have more than one home no help the ones with one home yes they have been put into a huge problem. Tell me how many one house families are behind in their payments then tell us how many in trouble have more than one house or should not have even been allowed to get a loan in the first place. Let ACCORN pay for the ones that should not have been given a loan in the first place. Would not take much research to find that out just call your buddy Mr. Frank and Dodd since they got the benifits for all those bad loans as well.
I have been selling residential real estate in Los Angeles for the past 33 years, and this is the worst market I have ever seen. Unless our government forces lenders to rewrite loans for more favorable terms, such as lower interest, fixed rates, and for longer terms, and forces the lenders to actually put all that bailout money to this purpose I can't see how we will ever have a recovery. The first few billions under Bush & Co have been horribly mishandled, and I hope Obama has the guts to force those who have received this money to account for what has been done with OUR money! As an aside, the IRS wants to know why I'm not making any money but still claiming deductions for my realty board dues, MLS fees, etc. I guess the IRS employees don't read newspapers, listen to the radio, or watch TV as they appear to have NO awareness of what is happening out there! What a surprise!
The government should do nothing. These were not homeowners these were renters who were able to live in a house way beyond there means instead of renting an apartment they could afford. I am a homeowner who paid my 20% down and bought a house I could afford. These homes in foreclosure were bought for nothing down and they bought homes way beyond their means. Is the government going to pay for people who have been living within their means mortgages or lower our interest rates. I don't think so. It's time we stopped rewarding people for poor behavior.
Sir : NOBODY is telling the facts that the lending institutions are not in need of a bailout for foreclosures! All of the sub-prime, low down payment, type mortgages that many people took, all require PMI, Private Mortgage Ins, to cover their lack of equity. In other words, when the banks foreclose, THEY are guaranteed to get ALL their money back, from the Insurance! That is why they foreclose, and refuse to allow 'short sales', or refinance with the borrower! The lending institutions, which we taxpayers have bailed out, MUST be ordered to let these homes be sold or refinanced, not let them sit for a year and then collect the full Insurance money, also from us taxpayers now!
PLEASE look into the borrowing, that most of the recent boom financing was low investment, needing PMI, which protects the LENDERS, not the homeowners!
Thank you. – Everett Ratzlaff
Jack; as usual government forgets the little guy. If anyone diserves a bailout it's all homeowners. Everyone that files a federal tax return making under $200,000.00 should get a one time grant of $100,000.00. Now that would stimulate the economy!!!
I think it is pretty simple if we take the greed out of the equation. The Bible speaks of usury and I believe that is the basis of the problem. The government should require that all mortgage interest rates be lowered to 3% and reset the term to 30 years fixed. We need to put in a process to ensure that illegal immigrants are not purchasing homes as I bet they account for 25% or more of the foreclosures. We need to enforce zoning laws–if the property is zoned single family we shouldn't have multiple families in one house with so many vehicles that others can't park their vehicles. These issues contribute to the decline of neighborhoods.
The government has given billions of dollars to the financing industry. Banks however cannot tell us how they have spent this money. If government really wanted to help people the solution is simple: Get that money back from the banks and give to people that are struggling to pay their mortgages. After all, the bankers are quite wealthy, they DO NOT need additional salary increases!
The government should do nothing. The only homeowners "upside down" on their mortgages are those who purchased in the last couple of years–people who purchased homes that were: 1) more than they could afford; and 2) during a period of hyper-inflated prices.
My wife and I have sat on the sidelines the last few years because we were saving a 20% downpayment and waiting for the prices to decline to "normal" levels. With a 20% downpayment and a 30 fixed rate mortgage, we could not have afforded the payments on a home here in Washington DC. Even with combined salaries of $200,000 our finances would have been stretched. I don't feel bad now that prices have declined. We live within our means, have an emergency fund, contribute to our 401(k), and don't have credit card debt.
Prices will come down another 20% in DC this year and we will purchase a home that reflects an accurate and fair price. Too bad for those that tried to live outside their means. People's homes are not worth as much as they think. The only way the housing market will be fixed to allow prices to reset and allow buyers to purchase homes with traditional mortgages in a price price range no more than 30% of their take-home pay.
Tough luck. No one has felt bad for first time buyers that were priced out of the market!
Hi Jack....The gov. has to stop giving money to instituation's like morgan stanley & bank's all together & give it directly to the American people to spend & this in turn will jump start the economy. We can make all the product's in the world but if people don't have any money to buy them they may just as well close the plant. I f we don't get thing's going soon, i see a Civil war comming when people run out of money for food & such.....THE GOV. HAS TO GET GOING & NOW
I think that the government should help the homeowners out because there is a lot of people that are trying to pay off their loans and if the economy gets any worse they won't be able to pay off their loans and they would lose their homes. I personally think that the government should help the people get their loans paid off and that in turn would help the banks recover.
Why doesn't the government tell this banks that before they get one dime more, that every house on an adjustable rate should be changed to a fixed rate at the value the house was purchased at from the start. Maybe it's just mebut we shouldn't help the banks unless they help those homeowners, I'd rather see each and everyone of them (Banks) crash and burn if they can't put into the problem they made.
Alot of people are going on an on about how people were getting bad loans and homes they couldnt afford. By now most of those have most likely, already been forclosed on. Everyone seems to be either forgetting or omitting the skyrocketing high unemployment. Forcing those who were getting by or those who didnt fall prey to the predatory loans, because while say a few months ago were doing everything they were supposed to, now have no job/money to afford their loans and now face the same problems. Theres also those who rent homes who find themselves being set out to the curb too because their landlords can't keep up on loans for whatever reason.
One thing that could be done would be to have all these banks who issued the predatory loans to revert the rates back to the cheap introductory ones and lock them for those individuals or have the government refinance them directly at a lower fixed rate. Might take longer to pay them off but atleast thered be a better chance of them being paid. Jobs also have to be created. Not just the ones for highly educated people but for all classes.
If the government would've done this immediately using the 700+billion bailout when it was first issued, we probably wouldnt be in the ecconomic ditch we all are in now.
The government should make it mandatory for lenders who have sub prime buyers in default carrying an interest only adjustable rate loan to modify the loans to a fixed rate loan. Those lenders knew they were giving questionable loans to people and it is up to them to straighten this mess out.
It seems to me if I were a lender and had a borrower making there monthly payment of $1600 a month on time each month and all of a sudden their payment jumped so much that they could no longer pay it, I would rather have $1600 instead of $0. By doing this we could stop a lot of bleeding in the real estate market and prevent the fair market value of properties to continue going down the toilet.
I make my house payment on time every month and have lost $40,000 of equity in less than 2 years due to foreclosures in my neighborhood. Why should I or anyone else who makes their mortgage payments on time have to pay for lenders giving bad loans to people.
The government has to do something such as lowering mortgages by 20%.This would build some confidence in this economy. Do this for home buyers who bought between 2005 and 2007.What a jolt that would bring, and probably would be much less costly in the long run.Banks are going to keep asking for more and more money and nothing will change.
Jack, If someone is bleeding badly from the right leg, you don't put the bandage on the left arm! Put the money at the 'source' of the problem. Help folks stay in their homes, or catch up payments. They will pay the banks, the banks become more solvent, and therefore don't 'need' any bailouts at all. There Jack, I solved the whole mess in just one paragraph! Your welcome.
The government is going to have to incentivize the write down of mortgages by lenders through either some sort of loan guarantee program or tax credit program similar to the low income housing tax credit or new market tax credit programs. There is currently no advantage to lenders to modify mortgages to an affordable monthly payment given that the value of most homes have dropped dramatically. Any viable solution will have to address the gap between what is owed on these homes and what these homes are currently worth. If that gap can be recaptured by lenders through some sort of tax credit that can be bought by businesses on the open market it will make the modification of loans more palatible.
This approach would eliminate the need for the continual bailout of financial institutions and create a means by which businesses could reduce their tax liability and invest that money in expanding their businesses and hiring or rehiring workers.
Complaining about the government bailing out irresponsible homeowners at this point is futile, the damage has been done and something has to be done to stem the tide of foreclosures (that has far reaching economic impacts on communities) that is now crippling the entire country including responsible homeowners.
North Charleston, SC
IF the government would stop the requirement of PMI it would take hundreds of dollars each month off their payment. With the way the market is you could wind up paying PMI and wasting that money for the next ten years
I agree with Judie from St. Augustine, FL on her comment that the banks should reduce the principle by 50% for homeowners that are up to date.
Make HER the Secratary Of The Treasury!
Have A Great Weekend!
why can't the feds hold a lottery, the winners get thier homes paid off
and the banks get thier money. seems like a win, win.
this way people keep thier homes, keep thier self esteem, and keep
them off assistance like welfare
.this would save us all money.
The government should ban ARM's, and allow homeowners in ARM's to get locked into their original rate. All of these measures shouldn't hurt the individuals credit score.
Jack, The government should help homeowners. If the government does not help the assets are then repossessed by the lender after foreclosure. When then happens the bank has to maintain the property or make a fire sale. Banks generally do not like the problems of owning.
A fire sale often nets the lender a fraction of the worth. There have been several ideas to help owners. Live in and paying rent, extension of mortgage and re-negotiation of terms are just two options
Insanity! We are throwing massive bundles of tax money we can't afford at the same banks that are ultimately at the heart of the original problem because of their lousey business practices!
Do we actually belive they have had some kind of death bed conversion that we can now trust our countries economic future with?
More than doubtful....
700 billion$ is about $2300 for everyone in the US. That really doesn't solve the crisis, and falls well short of Huey Long's, "Every man a king' and Hoover's, 'A chicken in every pot and a car in every garage.' The government must free the credit crisis so that we can continue to be a giant debtor nation. Wake up, America! The government ain't the savior– never has been, never will be. Maybe just a helper at best.
I am one of those families, living in Florida who are upside down in their home and being foreclosed upon. We have lost our jobs, have used all of our savings to survive, have zero health insurance, and now face a very uncertain future out on the street. The bailout for the Wall Street Tycoons was bunk. They should have been allowed to go under, just like us. You buy a home and you take your chances. The market needs these corrections, no matter how painful. The one thing that really bothers me is some of Wall Street's bailout money was used to buy oil futures, causing the new rise in fuel prices.
How about telling the banks we've been helping to help out the home owners by not throwing them out of their homes? These people deserve a chance to get back on their feet.
And where is this 350B the senate just approved going?
Couldn't at least some of that be used to help them?
Didn't Obama say he wanted to spend more time fixing main st than wall st?
Still waiting for the "Change".
The government should ban ARM’s, and allow homeowners in ARM’s to get locked into their original rate. All of these measures shouldn’t hurt the individuals credit score.
Home values went down, to no fault from homeowners. The government can help by reducing the mortgage value in proportion to the reduction in home value.
I am mad as H*** about what is going on. Bank of America is foreclosing on my home that I inherited from my mother whom I cared for until her death last February. When she was 86 we needed money for repairs she applied for a home equity loan on our home that was full paid for. She was forced to take out $168,000 loan for 30 years at 7.89% on a fixed income with no insurance for death, but apparently the bank figured she would be able to pay it in full in her lifetime. Since I haven't been able to find a job over the past 16 months with experience and a BA I can't get financing. So the Bank of America is foreclosing even though people have told me they violated TILA regulations in giving the mortgage and they have violated HUD regulations in the foreclosure process. To top it off they got the term of the mortgage among the $25 billion bailout money they got and they can still take the house from me and sell it for more money AND they are now asking for more bailout money so they can buy Merrill Lynch and make more money. And now on top of everything else with temps in the 30's my furnace went out, I have no money to even pay for a service call let alone repairs and the federal assistance money that is suppose to be available through the state is nowhere to be found. Where is my assistance and help? I thought I was doing the right thing in 1991 putting my life on hold to provide care for my parents in their final years. What I'm being shown from society and life is I should have just walked away from them and let them fend for themselves. So much for the humanity and supposed Christianity that so many in this country say is so important.
Government needs to work with investors to reduce principal balance on home loans to current market value of home properties. This will save me losing my first home.
So far, I am one of the lucky ones.
Against the current of the times, 6 years ago, I took a 30 year fixed mortgage.
I am a Real Estate Broker with a fluctuating income so I also took a "no income verification loan."
My income is down to about 35% of what I was earning 6 years ago. In advance of getting into trouble, today, I contacted my bank, Souverain to refinance or lower my interest rate, since rates have dropped to close to 4.65%. This would save me 600 dollars a month.
I was told, my income was not high enough to qualify me for refinancing. In other words, I am not qualified to pay 600 dollars less, per month than I pay now.
In addition, they said they are not doing anything to mitigate losses unless borrowers are already in default.
I have a very high credit score and have never been late on a mortgage payment.
If the government would refinance my loan at a significantly lower interest rate than I pay currently, I would not have any problem.
Extrapolate this situation to the public at large and you have a partial solution to the mortgage problem.
Let's see, with $350 billion and an average mortgage of $200K they could finance 1,750,000 homes. And just think, at 4% interest, they would be getting a better return than if that money were in a savings account. Hey, maybe that's where our Social Security Funds should be going...
The big banks received billions of taxpayer dollars from Congress. Members in Congress, Secretary Paulsen and President Bush thought the economic crisis would be solved by bailing out the banks. Only the head of the FDIC from the Bush Administration talked about saving American homeowners from foreclosures.
Obama is now talking about putting 50 billion from the TARP funds to help ailing homeowners. If homeowners are unable to get a modification of their loan from their lender or help from HUD, please tell them to contact their state bar associations. I am an attorney in Florida. In our state many attorneys are volunteering their time to help homeowners save their homes. Please act. Do not believe that the banks will win. Remember, judges are elected officials and have to face the voters to keep their jobs every few years. Obama has given us all hope for a better future. Yes, you can!
People who have become unemployed and can no longer make their monthly mortgage payments, should be allowed to tap into their 401K (or tax-deferred retirement savings accounts), to meet their monthly mortgage obligations without sustaining tax penalties, and without having to claim those withdrawals as taxable income. This will hopefully allow people to remain in their homes and reduce the need for other assistance. Of course, this will result in a decrease in future tax revenue, but our elected officials' hands-off approach to our financial institutions and business leadership, have led to this mess and ensured a much greater reduction in tax revenue from the devaluation of nearly all retirement savings accounts – – I can show you my IRA statements since August of 2008.
I think instead of these silly stimulus plans, and checks to the people, they should do a one time cross the board mortgage rate cut by one point. No credit scores necessary and refiance packages. Just drop everyones interest rate by 1 point and that will give security and control back into the peoples pockets every month.
By cutting the rate the government does not need to issue out money and checks that it does not have.
Given the low rates banks can borrow money for, not to mention the bailout billions, they should be unquestionably forced to stop foreclosing for a period of 12 months minimum, and in that time period, rewrite loans for actual value in today's market. Taxpayers have already covered their losses. Then, institute some very strict regulations to control these the offenders and money changers.
The housing crisis is not getting any better. I myself am a victim of this madness. Our home was on the market for the greater part of 2008 and no movement. Why? Many homes in the area were foreclosures and priced much less than our own. We couldn't afford to sell the home at those prices, yet we can't afford to keep it. So it looks like we will have to add to the crisis. It's one big bad cycle. I think there should be a program to help home sellers pay down there mortgages a little, at least enough to get the banks off of our backs. I think that is better than giving Wall street more handouts.
Correction: The government should help homeowners by banning bad lenders from conduct similar business.
We will continue to talk bailouts until good jobs are created and sustained. Most American citizens need a bailout, not only homeowners. People are struggling to maintain a basic quality of life. Issuing bailouts is a band aid solution for a third degree burn. We need jobs!
My mortgage is held my Countrywide, they told me they CANT help with the rate of interest, the principal or extending the loan. I had my home built in 2003 for $119K. I have a secure job, been there over 30 yrs. Due to less wages at my job I now cant afford the $900 mortgage, but can afford a $600 apt. Typical foreclosures in my neighborhood of the same type home is $80K. I'm a cheap bailout and a guarantee for a payback with just a slight adjustment.
But the foreclosure has really gave my credit 2 black eyes and there are millions of us running around with black eyes from our mortgage companies while the Banks and Wallstreet are getting wide eyes and bushy tailed waking up in the morning with billions to do nothing with but to buy other non-performing banks.
I feel like a blind dog in a silo looking for a corner to Pee in.
Want to stop or reduce foreclosures? Easy! Require the mortgage companies to work with the individual homeowners to restruction the conditions of the original loan. Notice I said "homeowners". This does not include investors, flippers and such, only homeowners!
The mentality of these hardline, do-it-our-way-or else mortgage companies is ridiculuous! Numbskulls! Seems to me they have the
best of both sides. In most cases, they have already recieved thousands of dollars in interest from the homeowner until payments cannot be made. They then foreclose, keep the property, resell it, and the go to the government and ask for a bailout!!
solve credit foreclosures and the economic
crisis simply: GIVE EACH FAMILY AT LEAST
$25,000., and we will bail out all of the
faltering markets. We will buy cars, houses,
and shop with ease. The industries will
rebuild because of us.
I live in Southern Indiana. It's getting desperate out here. I suggest the government send every household $60,000. Assuming no one wants to lose their home, the mortgages will be paid (in addition to credit card bills) and the households of the U.S. can bail out themselves. No one wants to borrow anymore more money, more and more people need immediate assistance and the Government would spend far less money saving us by just sending the money to "we, the people".
Easy Jack, the Wall Street Banksters should be required to house those regular American families in THEIR homes. After all they have plenty of space in their multiple residences and huge mansions. Maybe they will learn some humility and shame when they have to interact with the people they have victimized. Justice!
I bought a house but I lost my job and could not continue to meet my obligation of paying my mortgage. I contacted my mortgage company and explained to them that both my wife and I had lost our jobs and we needed to have our mortgage modified but they said that they could not do anything.
When we bought that house they asked us that to be able to qualify all needed to do was to do a stated income so we could buy it. They new back then that could not afford that mortgage. We were paying a high interest as high as 11% some times.
We were hoping that government would help the home owners not the bank who tricked us into a mortgage that we could not afford.
Here I am age 51 losing my house and already lost my life saving paying my mortgage.
SO WHERE IS THAT HELP THAT I WAS SUPPOSED TO COME FROM THE GOVERNMENT?
God help us survived these crisis, I already lost self confident in getting a job and still have three kids and a wife to support.
I like a combination of plans. Sheila Bair of the FDIC has recommended that troubled loans be renegotiated with the lenders – estimated US government cost is about $50 billion. Leading economists are recommending that where the homeowner is underwater - the fair market value of the home is less than the mortgage - the lender should write-down the principle. Probably split the cost between the lender and the government. This will help save the banks AND MORE IMPORTANTLY save the homeowners. All of this makes me weep, the cost to taxpayers and the loss of homes. However, I truly believe this will help to put our economy back on an even keel, instead of giving money willy-nilly to the financial community.
I live in the highest foreclosure zip code in the nation. Four homes within a stone's throw of my house have been sold at auction. This leaves the comparable rates of sales prices in my neighborhood at one half of the value two years ago. Most all of the paper on all of our mortgages is toxic. It wasn't homeownwers who sold them. Banks dumped these assets, ruined the market and further toxified their own assets. Short sighted greed at best. Force banks to bid no lower than the mortgage value at auction, the government could buy the houses at 80% of that figure, lend them to local governments for temporary low cost housing, thereby, keeping the market somewhat close to replacement cost. The housing industry could survive, jobs would be protected, the outstanding paper would hold its value and the crises would be short lived. All would suffer some. Most would survive and we the government would be buying real property instead of hopelessly useless paper until buyers realized that the fire sale is over and the crisis passed.
Any idea what should I do?
The government could let homeowners borrow against their Social Security to secure their home mortgage. Right now Social Security only earns 2% interest. If we let people borrow at a rate of say 4% (with 1% going to a bank to process the loan), they will get a low payment while getting an increased return (from 2% to 3%) on their SS principle and they become self-dependent as create their own financial security. And as we as a nation climb out of our financial mess individuals could INCREASE the interest that they pay on their mortgage knowing that any increase in interest is an addition to their retirement account. People could learn what it means to be independent as they own a home and save for retirement at the same time.
Additionally, this would secure the Social Security system with tangible real property instead of promissory notes from future generations. This is more intelligent than letting people take their Social Security to play the stock market (what a moronic idea that would have proved to be had Bush had his way..)
I,m in Las Vegas and trying to sell my house. No body knows where the bottom is. I think we need to appraise property values to what the value is now, and let homeowners in distress get loans based on that amount.
The banks need to assume some of the responsibility for making all the BAD loans in the first place. Way do we continue to bail out the banks?
Jack something that might help, could be to require the financial instititutions that are receiving the so called bailout money to look at the ARM loans that were made and, require them to go back and offer to refinance those loans at the fixed rate that would have applied at the time the loan was made. I know that would not be the answer for everyone but, it might help a lot of people who could have made their payments if not for the increased cost of everything else that hit us last summer when fuel prices went so high. By the way, most everything from groceries to utilities went up when fuel hit over $4.00 per gallon but, I don't see that anything came down since fuel prices have dropped
Jim, Cortez, Colorado
Why isn't the City reassessing the property value??Property taxes are the same as when my home was worth way more then now, and the assessment department is not doing anything about it. This is reminiscent of a monarchy and the feudal times. The banks,the car companies and the government all tied by big interests just like the king with the counts and the Barons ,do not really care about the poor people.Redistribution of wealth is not even the key,higher wages and stable jobs are the key to the welfare of the lower class. This is very well known by the government and for this very reason things stay the way they always have been,to keep the wealth in the hands of the 1-2% of the population.
Kill the federal reserve! I think that's what we should do!! But since that is not going to happen, ask every bank that is not using the bailout money to either use it to help homeowners or give it back.
Think about this the governement has given over 2 trillion (probably 3) in bailout money, if they divided that money among all homeoners( to be fair to those who are paying their mortgage) assuming a 2 trillionj bailout that would 25k apiece.
The same thing the government did for the all of those startup internet tech companies that went bankrupt following the dot.com meltdown. Nothing. What is really incredible is that the brightest economists and financial experts did not see such an obvious train wreck coming at them. Such an unsustainable increase in home values during the past 8 years had to come to an end, as it defies all common sense. Historians will rightly place much of the blame for the housing market meltdown on the Fed, under Greenspans incredibly naive leadership. Home prices must come down. For the government to pump billions of dollars into artificially keeping a floor under the housing market is wrong.
The biggest problem in this country that no one wants to touch are the unfair pay structures in our companies. In 1965, U.S. CEOs in major companies earned 24 times more than an average worker, in 2005 that had grown to 262 times. If a company is failing, the first course of action is always to cut jobs. Why don't executives take a pay cut? They probably wouldn't even notice a cut of 10% or 20% from their yearly salaries.
There ought to be a 'maximum' wage.
The government should make the banks use their bail out money to modify the loans to current market values. With lower principle & interest rates, the payments should be more affordable. These banks were deceptive and gambled on these mortgages. Families are not bankers, and were not fully educated on how these loans worked. The families in those homes should not pay for bad lending practices. Current market value or less is all the banks will get in a resale. They should save themselves the foreclosure expenses. And save the families from destroying their credit. All the banks (WaMu-Chase) are offering now is more of the same, selling low payments and holding off on the balloon for another 5 years. The money those institutions got from the govt, would more than pay off every foreclosure out there.
The government should reduce the mortgage by the current value minus 10%. Give the home owners a new mortgage and get the banks and mortgage brokers out of the loop. This would enable home owners to keep their homes and have a fresh start.
Jack Cafferty sounds off hourly on the Situation Room on the stories crossing his radar. Now, you can check in with Jack online to see what he's thinking and weigh in with your own comments online and on TV.
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