Helping Americans with the Housing Crisis
John McCain Is Proposing A New "HOME Plan" To Provide Robust, Timely And Targeted Help To Those Hurt By The Housing Crisis.
Under his HOME Plan, every deserving American family or homeowner will be afforded the opportunity to trade a burdensome mortgage for a manageable loan that reflects their home's market value.
Eligibility: Holders of a non-conventional mortgage taken after 2005 who live in their home (primary residence only); can prove creditworthiness at the time of the original loan; are either delinquent, in arrears on payments, facing a reset or otherwise demonstrate that they will be unable to continue to meet their mortgage obligations; and can meet the terms of a new 30-year fixed-rate mortgage on the existing home.
How It Works: An individual picks up a form at any Post Office and apply for a HOME loan. The FHA HOME Office certifies that the individual is qualified and contacts the individual's mortgage servicer. The mortgage servicer writes down and retires the existing loan, which is replaced by an FHA guaranteed HOME loan from a lender.
John McCain Calls For The Immediate Formation Of A Justice Department Mortgage Abuse Task Force.
The Task Force will aggressively investigate potential criminal wrongdoing in the mortgage industry and bring to justice any who violated the law. The DOJ Task Force will offer assistance to State Attorneys General who are investigating abusive lending practices.
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OV Social
I am Republican to the core...in values, not political party identity. I believe all these 'bail-out' plans, particularly those relating to the housing situation, run against the core belief system of CONSERVATIVE and REPUBLICAN. This is more like socialism--which is why neither Obama or McCain is getting my vote.
What happened to personal accountability and responsibility--even at the corporate or industry level? Where did the notion of consequences go? I understand the massive level of the problem. I believe, however, that the problem is indicative of a much deeper problem: greed and entitlement. This epidemic has swept the nation and can be witnessed in many, many areas of our society. How many people are still living in welfare housing/trailers from the Hurricane Rita disaster? What's the increase in bankruptcy filings? Don't even mention "abortion" and Obama's comment about a kid getting "punished" for being pregnant/having to raise a child. The leading politicians, parties, and the elitists need to actually "help" Americans. Let us all reap what we have sown.
The banks already pulled as many mortgage foreclosures as they could in anticipation of the government bailout. It has long been a planning policy with the banks since the last bailout. What is the current score?
Banks 4, Foreign investors 6, US consumers -10
I recall the banks shifting debt to sacrificial banks on the last bailout. Hardly any loan stayed with its original institution.
Even the poorly families that do not "qualify" for a bank mortgage, get to pay for these bad mortgages.
Hmmm... Not good enough to own a home, but good enough to fleece for cash. Home prices have been inflated to the point that fanny and freddy hold half the housing value in the country. That staggering fact in the face of "protecting" the property values of the people affluent enough to own their homes. How about distributing some of those empty homes to charities to distribute to needy families? At least the American public might see some value to this debacle.
How about letting homes free fall as a free economy would have happen? Prices might just come into the range for people to be able to afford them, and perhaps banks wouldn't be so free with the paper they issue. Fanny and Freddy could do sell offs at $0.25 on the dollar. Isn't that what used to happen to "former" home owners? Oh, yea, bankruptcies used to be easier and cheaper.
Used to be the better off people helped out the less fortunate. Now we have the less fortunate carrying the burden of the better off. How long have we been upside down on this social issue?
I agree with your comment. I don't agree with your choice of Obama. From my perspective, the "affluent" includes all the major parties' cronies: Obama and McCain included. All of these guys are the proverbial 'haves'; the rest of us are the pawns--the means to line their pockets. And these means DO NOT justify the end.
We are not a Democracy. We are a Republic--a country ruled by law, and that law is determined by the affluent for their benefit. The law PREVENTS a free market from operating. It negates the system for which it was created to protect..
Proving credit-worthiness is the problem. By the time the new President takes office, this out-of-control,downward-spiraling economy will surely be worse than now. More people will have lost their jobs, will not be able to afford healthcare, medical bills will eat up their small savings and their credit ratings will have plunged even further. Going to the Post Office to pick up a form would be laughable if this were not such a serious situation.
Fantastic plan - where do I sign up to abdicate my responsibilities? Didn't those borrowers sign alot of paperwork confirming and reaffirming that if they couldn't make their payments, they would give the house back to the bank? Or was all that kind of a legally binding "suggestion" or "nice to have". I just want to be clear on the new federal interpretation of loan documents before I notify my bank that the next correspondence they'll get from me will be an FHA notice instead of my next monthly payment.
How about the investor that holds the note which the FHA is asking (demanding?) be written down? Usually it's the GSEs - which are now (surprise!) branches of the Treasury. So the taxpayer bails out a delinquent homeowner with an "unconventional" ie subprime mortgage. The GSE's debt (paid by these mortgages) is held by pension funds, retirement funds, and retail investors (small town residents with small town values(tm)!). So in the end the investor and taxpayer gets to eat the loss because a poorly qualified borrower couldn't keep up with their home payments - without even pursuing foreclosure to get their money back. Here's a novel thought - why not let the investors offer to write down the note if it's in their best interest versus letting the FHA force them to? At the end of the day, the government is breaking a legal contract between two private parties to enforce a public policy that benefits the least responsible members of society to help fund a highly speculative enterprise. Seems to me to be contrary to every Republican principal I'm aware of.
Please let me know when my car loan, student loan and credit card bills are deemed "too big to fail". They are all securitized, all held by major financial institutions and all handed out daily with little to no underwriting standards.
The mortgage mess will not be fixed by the government. It will be fixed by the market. If the government changes the rules mid-game, the market will lockup waiting to see what move will come next. If the government had stepped back and let investors determine risk/reward levels they could all live with, house prices would find a recovery level, poorly qualified borrowers would be foreclosed on and return to renting, developers would stop building properties noone can truly afford and "house flipping" would become a quaint memory.
I am sure Democrats will offer some way to intervene in the system as well. Since the government now runs the GSEs both parties have no choice. But this plan is about as dumb as suspending gas taxes when supply/demand drives prices up. How about rent subsidies? Relocation cost reimbursements? Incentives to own rental property? That would return home prices to normal levels (based on rental income potential, not flip sale potential), encourage long term owners to buy up foreclosed homes and keep poor/subprime borrowers with a roof over their heads.