Hey, Responsible Americans! Guess What?
Are you one of the millions of Americans who have a mortgage they can afford? Were you one of the vast majority of people who took a little time and decided that an interest-only mortgage or an ARM actually involved something called “risk” and decided that it was more “risk” than you should take with your home? Perhaps you were one of those folks who decided not to go out on a slender financial limb, showed a little bit of intelligence, and decided to wait to buy your house when the prices became a lot more sensible?
Are you one of the tens of millions of Americans who did the right thing, decided to live within your means, and didn’t take a big flyer on a risky get rich gamble?
More and more, it looks as though Congress, followed by a reluctant White House, will move ever more boldly to stop the hemorrhaging in housing and unfreeze the credit markets…Most of the legislative energy seems to be swirling around a plan put forward by Democratic Rep. Barney Frank. The plan, as outlined by Bove:
• FHA provides up to $300 billion in new guarantees to help refinance at-risk borrowers into viable mortgages.
• The terms of the first mortgage are set at a level that the borrower can afford.
• A second mortgage is put in place, which pays off on sale of the house and allows the government to recover the losses absorbed by creating the first mortgage at below market rates.
• The existing lender agrees to accept a reduced payment, which could be substantial since the new loan is based on the house’s current appraised value.
• Gets the existing lender free of all obligations and exposure to the borrower.
• Refinance between 1 and 2 million homes.
• Provide funds to refurbish empty homes and put them back on the market.
Maybe now you’ll learn that if you pout enough and make those puppy-dog eyes to your Congressmen, your government will make sure that you’re not responsible for your own stupidity or greed. And better, they’ll make your friends and family pay for it! Bonus!
I sure hope you’ve learned your lesson. Dummy.
(via Instapundit)
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Category: The Economy and Your Money
I think that the sellers should give back a few hundred thousand to the buyers. Nobody talks about the huge profits made by people who bought low many years ago and sold their houses for enormous unearned profits. The truth is lower housing costs are great.