mortgage bailout - let's see if i got this right....

[nynor]

those that overextended on their mortgages, and are foreclosing, are going to get their bills paid by you and me!?

wow, i should have bought more house five years ago.

maybe they should just house swap: i get the huge house that is now worth what i pay on my mortgage, they get my little house that i prudently purchased well within my means.

[Porsche-O-Phile]

Unreal.

I watched, frustrated, as idiots all around me with jobs making half of what I was making ran out and bought $400k condos and $600k houses the last 5-or-so years, knowing that I was "doing the right thing" by waiting and that I'd get my opportunity and just reward for exercising fiscal restraint.

Guess not.

Absolutely unfathomable. I can only believe (and hope) that karma will catch up with these people, since the gubmint is doing their damnedest to prevent the free market from working as it should. Incredible.

[Rick Lee]

I haven't even seen anyone on tv, other than pandering politicians, defending this BS. Anyone who really understands the problem and its root causes is vehemently against this. I'm really starting to wonder if I live in a cave. It seems to me everyone I know is so against so much of the stuff that's going on, yet it passes or will pass without a hiccup.

[Noah930]

I feel like I'm in a similar boat, P-O-P. Just these past couple months, I'm finally seeing starter home prices in my area fall within my financial reach. Yet, as a "rich doctor," (aren't we all?) I make too much to qualify for the tax credit proposed for first-time home buyers. And now, our American mission is to "stabilize the housing markets," and "shore up falling home values." So that what, "rich doctors" can't afford to buy starter level homes, again?

I realize my little rant sounds fairly self-absorbed and selfish. But heck, if I'm supposed to be part of the privileged class (as I'm supposed to be--just like how everyone who drives a Porsche must be rich, too, right?), and I can't afford to live in SoCal, I don't know how the rest of people are supposed to make it.

Maybe I should have used some green font, in there.

[jyl]

10% of US homes are in foreclosure or in the delinquency funnel to foreclosure. Many more will follow. Having, let's say, 15-20% of US homes in foreclosure will do enough damage to the economy to bring down many of the rest of us. The swelling membership of the PSUP illustrates this. Very few of us will be able to comfortably sit back and watch the meltdown. In a very practical sense, we are all in the boat together. I will not benefit from the mortgage modification effort but I support it. If your profession is related even indirectly to consumer spending (and virtually everyone's is, even doctors and commercial architects) it is in your interest that fewer, not more, families go into foreclosure.

I still hear many people describing the problem in selfish, righteous, "us versus them" terms. Let the banks collapse, let every fifth house be foreclosed, let the economy crumble, don't spend a cent to cushion the blows. Most of you will find out that you're more "them" than you think. As you count your unemployment checks.

[jyl]

Why don't you simply sell your house and buy that big house? It is a lot cheaper now.

those that overextended on their mortgages, and are foreclosing, are going to get their bills paid by you and me!?



wow, i should have bought more house five years ago.



maybe they should just house swap: i get the huge house that is now worth what i pay on my mortgage, they get my little house that i prudently purchased well within my means.

[74-911]

Originally Posted by jyl

10% of US homes are in foreclosure or in the delinquency funnel to foreclosure. Many more will follow. Having, let's say, 15-20% of US homes in foreclosure will do enough damage to the economy to bring down many of the rest of us. The swelling membership of the PSUP illustrates this. Very few of us will be able to comfortably sit back and watch the meltdown. In a very practical sense, we are all in the boat together. I will not benefit from the mortgage modification effort but I support it. If your profession is related even indirectly to consumer spending (and virtually everyone's is, even doctors and commercial architects) it is in your interest that fewer, not more, families go into foreclosure.

I still hear many people describing the problem in selfish, righteous, "us versus them" terms. Let the banks collapse, let every fifth house be foreclosed, let the economy crumble, don't spend a cent to cushion the blows. Most of you will find out that you're more "them" than you think. As you count your unemployment checks.

+1
Thank you for one of the very few rational, pragmatic posts re: the mortgage bailout.

[nynor]

Originally Posted by jyl

Why don't you simply sell your house and buy that big house? It is a lot cheaper now.

uh, did you forget the part where my house has depreciated as well due to these nitwits.

[jyl]

And your house will fall further in value. The more foreclosures in your region, the farther your house will fall. Your house was overvalued like the rest of them.

I have not seen a recent breakdown, but I believe the foreclosure wave has moved beyond the subprime, overstretched, ninja speculator loan homes. I believe the bulk of foreclosure will ultimately be "normal" borrowers who have been hit by the economy. Someone lost a job, or took a big pay cut, or business is just very bad. And the house has fallen in value so much that they're pushed off the cliff.

Quote de jyl

Why don't you simply sell your house and buy that big house? It is a lot cheaper now.

uh, did you forget the part where my house has depreciated as well due to these nitwits.

[Wickd89]

Originally Posted by Porsche-O-Phile

Unreal.

I watched, frustrated, as idiots all around me with jobs making half of what I was making ran out and bought $400k condos and $600k houses the last 5-or-so years, knowing that I was "doing the right thing" by waiting and that I'd get my opportunity and just reward for exercising fiscal restraint.

Guess not.

Absolutely unfathomable. I can only believe (and hope) that karma will catch up with these people, since the gubmint is doing their damnedest to prevent the free market from working as it should. Incredible.

Completely agree. Makes me furious!
I bought a small home with 50% down. With that down payment, they told me to buy a bigger house but "I KNEW" that i could not afford the mortgage on a bigger house so I squeezed into a smaller home.
Others I know BRAGGED about their big homes, zero to little down, etc,etc...
Now it is time to pay. Their speculation brought up the price of homes for all of us and we payed for it.

How about this. Give me the loan on their house (since I am responsible enough to insure it gets paid), and they can RENT from me...

[Noah930]

Originally Posted by jyl

10% of US homes are in foreclosure or in the delinquency funnel to foreclosure. Many more will follow. Having, let's say, 15-20% of US homes in foreclosure will do enough damage to the economy to bring down many of the rest of us. The swelling membership of the PSUP illustrates this. Very few of us will be able to comfortably sit back and watch the meltdown. In a very practical sense, we are all in the boat together. I will not benefit from the mortgage modification effort but I support it. If your profession is related even indirectly to consumer spending (and virtually everyone's is, even doctors and commercial architects) it is in your interest that fewer, not more, families go into foreclosure.

I still hear many people describing the problem in selfish, righteous, "us versus them" terms. Let the banks collapse, let every fifth house be foreclosed, let the economy crumble, don't spend a cent to cushion the blows. Most of you will find out that you're more "them" than you think. As you count your unemployment checks.

I understand what you're saying. It's not in our collective best interest to have another Depression. I'm one of the most pragmatic guys you'll ever meet. I think things should be reasonable. But, they weren't. Not even close. Yet, somehow, we're in this mad rush to get back to that pre-bubble economic state? As if that was healthy and sustainable? You're the economics whiz--were those truly "good times?"

I'm not against the government trying to avoid a severe and extended economic downturn. I've reluctantly said so in past posts. But I'm not necessarily supportive of falsely propping up an unsustainable economy (and the mentality and values of the society behind it). I don't hear the talking heads saying that we need a sustainable economy. I hear the rhetoric claiming that we need to get back to where we were. Or at least that's my take on things. Perhaps I'm too literal.

And, personally, while my economic health is indirectly tied to the economy as you point out, it doesn't fluctuate nearly as much as most others' incomes. When times are booming, I don't boom nearly as much as the next guy. When times are tough, fortunately I'm a bit insulated from that, as well. So, from a selfish perspective (and admittedly slightly simplistically), my "buying power" is actually a bit better during times of economic hardship. Relative to others, I actually make more even if my income (in dollars and cents) doesn't change. Not that I wish economic hardship on anyone.

[Porsche-O-Phile]

Yea, I can see both sides. JYL makes a good point re: how society functions as a collective and there are implications for everyone in it. However, it chaps my arse worse than sandpaper boxers that these morons are getting off scott-free. There has to be some kind of balance or way that these people "get the message" while not necessarily allowing the fabric of society to completely tear apart as a result of their stupidity and the ensuing re-alignment of things.

I personally think there should be SEVERE penalties for taking the anti-foreclosure assistance. People that walk away from mortgages "just because" they didn't appreciate at the 20% per year that their douchebag realtors and mortgage brokers promised they would shoud get handed bills for the difference - due and payable to the IRS (since the feds are underwriting all this crap). Let the IRS go after them for the $$$ for the next 20-30 years. That'd rein it in pretty quickly, but it's too politically incorrect for our pussified politicians to ever propose - instead they look at it as a question of pandering to the lowest common denominator because "a stupid person's vote is still a vote".

I guarantee if the feds started going after people for the difference between note value (underwritten by Fannie/Freddie) and auction value, people would start thinking twice about just "taking the easy way out" and handing the keys in. Maybe they'd get off their asses, start selling one of their four luxury SUVs and/or plasma TVs and go get a second (or third) job to MEET THEIR OBLIGATIONS!

Hell, it'd stimulate job growth too. Win-win for everyone. Except the politically correct ninnies of course.

Just another example of how soft and mentally flabby we've become as a nation - things will get no better until we start sacking up and administering "tough love" to people and forcing them to be honest.

[mikester]

Part of the problems related to the great depression was the slow response to the problems by the government. It was very passive until the new deal and FDR's election. It is widely considered that the passive response widened the depression significantly.

So - I See that we should do something and probably not go all ultra-capitalist man here but it sure chaps my hide that I probably won't get anything directly out of it because I was responsible.

I'm thinking of a word that starts with 'F' and ends in 'uck'




(firetruck)

[nynor]

Originally Posted by Wickd89

C
How about this. Give me the loan on their house (since I am responsible enough to insure it gets paid), and they can RENT from me...

that is pretty damn close to what i am saying.

[Rick Lee]

What? FDR became POTUS in 1933. The Depression was in full swing for year by then and lasted another eight years after that. Whatever he did that "ended" the Depression, he didn't do it real fast.

[nynor]

all FDR did was to expose and offer the government tit. we've been reaping the benefits of those policies ever since.

[therotman]

Originally Posted by Noah930

I feel like I'm in a similar boat, P-O-P. Just these past couple months, I'm finally seeing starter home prices in my area fall within my financial reach. Yet, as a "rich doctor," (aren't we all?) I make too much to qualify for the tax credit proposed for first-time home buyers.

The tax "credit" has to be paid back to the government in yearly payments after two years. It is not free money and really only helps people buying $100k or less homes. The loan is interest free so if you buy a super low priced house it's a nice help, but in most regions where the houses are more than double that a $7500 interest free loan doesn't do anything.

[ruf-porsche]

Originally Posted by nynor

uh, did you forget the part where my house has depreciated as well due to these nitwits.

Exactly, and if we keep letting more houses go into foreclosure guess what it going to affect us even more.

I don't mind helping people who brought a house to live in, but I do mind if we start bailing out the people that were flipping houses and got caught without a chair to sit in when the music stopped.

[ruf-porsche]

Originally Posted by Porsche-O-Phile

...........................I guarantee if the feds started going after people for the difference between note value (underwritten by Fannie/Freddie) and auction value, people would start thinking twice about just "taking the easy way out" and handing the keys in. Maybe they'd get off their asses, start selling one of their four luxury SUVs and/or plasma TVs and go get a second (or third) job to MEET THEIR OBLIGATIONS!

The only problem is there isn't any jobs out there. Even Home Depot and a lot of the other big box retailers are not hiring. Smaller business are down to their minimum staff in order to survive this recession.

If we are to subsidise their housing, I better not see them driving around in a fancy car, but how many time have you seen people pay their grocery bill with food stamps and then go out into the parking lot and load everything in their shiny Cadillac or BIG SUV, or worse in their PORSCHE.

[Porsche-O-Phile]

Maybe they should have thought about that before signing the papers. NOT MY PROBLEM!

The smart/motivated ones will create businesses and therefore jobs/income for themselves. If properly wielded, desperation can be a powerful motivator. Our "leaders" need to toss a little desperation the way of these folks - some good would of course come out of it.

Not to mention, if the government announced they were going to start holding peoples' feet to the fire by means of the IRS (like I'm suggesting), the confidence in the banks would jump overnight and you'd start to see a perceptible reversal in the economic downturn.

Yes, things suck right now but there's no question that stupid housing speculation was a CAUSE of the downturn, not an EFFECT of it.

Take away the stupid folks' "easy out" and watch how quickly they get motivated. Problem is we're too much of a wussy society to force people to do it.