Obama rolls out 75 billion home foreclosure prevention
Yesterday Obama's foreclosure plan was unveiled and today House passed a bill that allows bankruptcy judges to modify loans . As of now Harry Reid plans to pull over spineless liberal GOP members to shove another travesty upon responsible Americans.
If you are wondering why anyone would oppose a bill that apparently helps the housing a crisis, a leading catalyst of our current financial malaise, let me explain.
First of all, despite all of Obama's lies as of now it does not appear that any programs or any provisions reward people who were responsible. He has said on multiple occasions that his plan will not only help struggling homeowners, but in the spirit of equality our dear leader indicated that the rest of us will not be left in the dust. As of now, we are left in the dust and worse yet, we are on the hook for all the unfortunate souls who were too stupid to read English language of the mortgage terms they were signing. Meanwhile because my CC company lost my payment and my credit score is an embarrassing 680 the best mortgage I could get on my townhouse was 6.125%? I am strongly contemplating in stopping my mortgage payments and become eligible for a government program.
So what does Obama have in store for the 2% of the people in this country who used subprime mortgages to refinance their homes (not buy their homes, refinance!)?
First, the legislation just passed, the loans and terms will be rewritten to satisfy a new rule; Mortgage payments cannot exceed 31% of their monthly income. First of all, I have no idea what this means for those that are currently unemployed. Second of all, this allows the judges to lower the rate on the loans to levels that do not actually exist in the market. Loans could go as low as 3% and why not? Of course you cannot get a 3% loan, because the current mortgage rates that are available to the public are just below 5% assuming you pay closing costs AND points.
Second, someone will be losing money on this transaction. When the original terms of the mortgage was signed, both the lender and the borrower assumed certain responsibilities. The lender will now be taking a loss on these loans, given the payments that the lender once relied upon will now shrink. Unfortunately all losses must be absorbed one way or another and it will be translated upon the taxpayers as costs go up for refinancing.
Thirdly, there are absolutely no precautions taken to avoid delinquencies after re-financing. According to OCC.gov, a program designed to refinance struggling home owner's loans fell delinquent with half a year, in fact more than 50% of these new mortgages failed. Where are the precautions?
Lastly, as of now it appears that after the delinquent borrowers get refinanced and stay in their home, they are not obligated to refund the losses of the lender provided the homes go up in value! So basically we are asked to fund people's mortgages for houses they do not deserve to live in and if by some chance house values recover, these delinquents can sell it - collect profit and move on with their lives.
What
the
hell!?
If you are wondering why anyone would oppose a bill that apparently helps the housing a crisis, a leading catalyst of our current financial malaise, let me explain.
First of all, despite all of Obama's lies as of now it does not appear that any programs or any provisions reward people who were responsible. He has said on multiple occasions that his plan will not only help struggling homeowners, but in the spirit of equality our dear leader indicated that the rest of us will not be left in the dust. As of now, we are left in the dust and worse yet, we are on the hook for all the unfortunate souls who were too stupid to read English language of the mortgage terms they were signing. Meanwhile because my CC company lost my payment and my credit score is an embarrassing 680 the best mortgage I could get on my townhouse was 6.125%? I am strongly contemplating in stopping my mortgage payments and become eligible for a government program.
So what does Obama have in store for the 2% of the people in this country who used subprime mortgages to refinance their homes (not buy their homes, refinance!)?
First, the legislation just passed, the loans and terms will be rewritten to satisfy a new rule; Mortgage payments cannot exceed 31% of their monthly income. First of all, I have no idea what this means for those that are currently unemployed. Second of all, this allows the judges to lower the rate on the loans to levels that do not actually exist in the market. Loans could go as low as 3% and why not? Of course you cannot get a 3% loan, because the current mortgage rates that are available to the public are just below 5% assuming you pay closing costs AND points.
Second, someone will be losing money on this transaction. When the original terms of the mortgage was signed, both the lender and the borrower assumed certain responsibilities. The lender will now be taking a loss on these loans, given the payments that the lender once relied upon will now shrink. Unfortunately all losses must be absorbed one way or another and it will be translated upon the taxpayers as costs go up for refinancing.
Thirdly, there are absolutely no precautions taken to avoid delinquencies after re-financing. According to OCC.gov, a program designed to refinance struggling home owner's loans fell delinquent with half a year, in fact more than 50% of these new mortgages failed. Where are the precautions?
Lastly, as of now it appears that after the delinquent borrowers get refinanced and stay in their home, they are not obligated to refund the losses of the lender provided the homes go up in value! So basically we are asked to fund people's mortgages for houses they do not deserve to live in and if by some chance house values recover, these delinquents can sell it - collect profit and move on with their lives.
What
the
hell!?
Comments
Post a Comment