Bush Unveils Mortgage Relief

[gururu2]

Originally posted by: Zedtom

I thank you for the clarification. My "small print" remark should really refer to "small explanation of the details". I think most people were unclear about the specifics and were just relieved that somebody was actually going to lend them the money.

what, you mean 10 pages written in legal language may be unclear? pfft.

 

[senseamp]

Originally posted by: rpanic
I don?t know if this has been posted already I didn?t see it.

Bush gave out the wrong number during his speech, He said to call 1-800-995-HOPE, he should have said 1-888-995-HOPE. If you call the number Bush gave all you get is a busy signal.

Don't worry, the average person dumb enough to take out an ARM won't figure out how to dial H-O-P-E either

 

[her209]

Originally posted by: senseamp

Originally posted by: rpanic
I don?t know if this has been posted already I didn?t see it.

Bush gave out the wrong number during his speech, He said to call 1-800-995-HOPE, he should have said 1-888-995-HOPE. If you call the number Bush gave all you get is a busy signal.

Don't worry, the average person dumb enough to take out an ARM won't figure out how to dial H-O-P-E either

Yeah, they'll keep hitting zero instead of six.

 

[randym431]

Bush Unveils Mortgage Relief

Shouldn't it read "Bush Unveils plan to Relieve owners of Mortgages" :shocked:

 

[Vic]

Originally posted by: Zedtom

Originally posted by: senseamp

Originally posted by: Vic

Originally posted by: Zedtom
The mortgage lenders have only themselves to blame for taking high risk candidates and sneaking the small print in to the contracts. The one thing money lenders detest is having to dispose of foreclosed properties. They are in the money business and real estate is too bulky for them to have to manage.

Please... there is no "small print." Mortgage documents are strictly regulated by state and federal laws, which dictate everything from disclosures to verbage to fonts. Relevant/important information in mortgage documents is not only bolded and of larger font size, but there is also multiple documents to be signed to disclose that information.
For example, if a loan has an adjustable rate, that feature alone will mean roughly an additional 10 pages of documents and 5 additional signatures required, all of them with lots of large bold print saying "NOTICE!" "WARNING!" and "ADJUSTABLE RATE" etc.

Plus it's called Adjustable Rate Mortgage. There is certainly nothing small print about that, it's right in the name of the product. Everyone going in knows the rate will adjust or at least has no excuse for not knowing. It would be like me buying a bottle labeled "Water" and then saying I was tricked because there was water in the bottle.

I thank you for the clarification. My "small print" remark should really refer to "small explanation of the details". I think most people were unclear about the specifics and were just relieved that somebody was actually going to lend them the money.

Bullshit.

 

[redgtxdi]

Another facet of this joke that hasn't been hit on yet.........

What about the foreign money tied up in these loans???


Wonder what they'd have to say about it.

Would they rather gamble the potential for more defaults or would they ride the junk into the sea??

Too much risk/reward for the kind of stuff I invest in so I can't speak from that angle.

 

[smack Down]

Originally posted by: LegendKiller

Originally posted by: GrGr

Originally posted by: heyheybooboo
Topic: Bush Unveils Mortgage Relief
Topic Summary: Helps only scumbag investors bought these securities

Harsh, but fixed

It is the entire system this measure seeks to protect.

If banks go down investors go down with them. If investors go down the faith in the system goes down. This embraces everything within the global western economic system. For example, the Saudis own a large part of Citigroup, what will they think, and do, if Citigroup goes down. And not only will American banks go down, British and German banks will go down too, triggering a recession as they go, possibly even a real depression.

The root of this measure is to protect the leveraged debt instruments, many of which the banks created out of crummy deadbeat loans and sold to investors, and pretend they still have some real value anywhere near their leveraged and inflated paper value.

These little crummy loans to deadbeats go so deep into the system. That is why they are such a headache. And that is why the Bush administration resorts to this totally perverted and desperate measure.

Lets be clear, the "entire system" would survive with or without this. Sure, some banks would go under. Some investors would lose a lot of money. Some homeowners would lose houses. However, just like any bubble/bust, it will deflate and move on. It did so with the tech bubble and will do so with all future bubbles.

One way or another, we *will* return to rationality, whether it's this year or in 5 years, it will happen. We can delay the inevitable, in which case it will only build up and get worse, or we can take our licks and get done with it.

The fear of recession is nothing more than a by-product of Americans thinking that the government needs to hold their hands in any transaction. It's bullshit, complete and utter.

If anything, this undermines the entire system of securitization and contract law. If servicer/sellers can wholesalely change contracts, or large pools of mortgages, then they can do anything. It undermines the strength of a contract, the strength of securitization trusts, and the overall ABS system, which has enabled much cheaper borrowing and flow of funds.

The securitization market was based on fraud and lies anyways. I don't think change a handful of loans to the benifit of those owning the mortage is going to make a bit of difference in peoples' confidence about the securitization market. This program just does a little to fix the compounding stupidly of the lenders by removing clauses from the contract that are bad for both parties.

 

[1EZduzit]

Originally posted by: Vic

Originally posted by: Zedtom
The mortgage lenders have only themselves to blame for taking high risk candidates and sneaking the small print in to the contracts. The one thing money lenders detest is having to dispose of foreclosed properties. They are in the money business and real estate is too bulky for them to have to manage.

Please... there is no "small print." Mortgage documents are strictly regulated by state and federal laws, which dictate everything from disclosures to verbage to fonts. Relevant/important information in mortgage documents is not only bolded and of larger font size, but there is also multiple documents to be signed to disclose that information.
For example, if a loan has an adjustable rate, that feature alone will mean roughly an additional 10 pages of documents and 5 additional signatures required, all of them with lots of large bold print saying "NOTICE!" "WARNING!" and "ADJUSTABLE RATE" etc.

Then let someone foreclose on their McMansions these people thought they had to have. If it hurts the lenders then perhaps they will increase the font size of their big "WARNING"s next time. The fact is the lenders made these loans becasue they were greedy and now that greed has come back to bite them in the ass. Too bad, so sad.

 

[LegendKiller]

Originally posted by: smack Down

Originally posted by: LegendKiller

Originally posted by: GrGr

Originally posted by: heyheybooboo
Topic: Bush Unveils Mortgage Relief
Topic Summary: Helps only scumbag investors bought these securities

Harsh, but fixed

It is the entire system this measure seeks to protect.

If banks go down investors go down with them. If investors go down the faith in the system goes down. This embraces everything within the global western economic system. For example, the Saudis own a large part of Citigroup, what will they think, and do, if Citigroup goes down. And not only will American banks go down, British and German banks will go down too, triggering a recession as they go, possibly even a real depression.

The root of this measure is to protect the leveraged debt instruments, many of which the banks created out of crummy deadbeat loans and sold to investors, and pretend they still have some real value anywhere near their leveraged and inflated paper value.

These little crummy loans to deadbeats go so deep into the system. That is why they are such a headache. And that is why the Bush administration resorts to this totally perverted and desperate measure.

Lets be clear, the "entire system" would survive with or without this. Sure, some banks would go under. Some investors would lose a lot of money. Some homeowners would lose houses. However, just like any bubble/bust, it will deflate and move on. It did so with the tech bubble and will do so with all future bubbles.

One way or another, we *will* return to rationality, whether it's this year or in 5 years, it will happen. We can delay the inevitable, in which case it will only build up and get worse, or we can take our licks and get done with it.

The fear of recession is nothing more than a by-product of Americans thinking that the government needs to hold their hands in any transaction. It's bullshit, complete and utter.

If anything, this undermines the entire system of securitization and contract law. If servicer/sellers can wholesalely change contracts, or large pools of mortgages, then they can do anything. It undermines the strength of a contract, the strength of securitization trusts, and the overall ABS system, which has enabled much cheaper borrowing and flow of funds.

The securitization market was based on fraud and lies anyways. I don't think change a handful of loans to the benifit of those owning the mortage is going to make a bit of difference in peoples' confidence about the securitization market. This program just does a little to fix the compounding stupidly of the lenders by removing clauses from the contract that are bad for both parties.

Support your assertion as to why you think the Securutization market is based on fraud and lies, I will enjoy ripping that one apart.

As a person who works in it and is already reading industry publications deriding this measure, I can most assuredly say that it's going to erode confidence in the market.

The clauses aren't bad for both parties. Being able to get out of a contract undermines the entire legal system (british common law). To think anything else is sheer stupidity. It's not a clause, it's a legal document that you *sign* verifiying you understand. You cannot just be let off the hook because you made a moronic decision.

So, lets hear it sparky.

 

[bwatson283]

Learn what your getting into so the rest of us tax payers don't help bail you out. Where else do you think the cash is coming from?

 

[LegendKiller]

Originally posted by: bwatson283
Learn what your getting into so the rest of us tax payers don't help bail you out. Where else do you think the cash is coming from?

Well, obviously the tax money spent on your education failed to give you reading skills, what should we do about that?

There are *no* tax funds being spent on this. Go read a few more articles.

 

[mshan]

From what I've read, this "bailout" basically does nothing, except give the appearance that politicians are doing everything they can to keep homeowner's from losing their homes (when they are really doing nothing).

It almost seems like the Fed and now the White House are targeting the stock market (an artificial, at least tradeable bottom in the stock market may be in place because bears may find it dangerous to short stocks too aggressively when the Fed and White House can create a nasty short squeeze anytime they feel it can have maximal effect), trying to prevent a precipitous decline that could further depress consumer confidence, depress consumer spending below what it is currently is, and push a slow, but non-recessionary economy into a true consumer recession.

Time will tell.


EDIT: I read that teaser rates for true subprime loans were like 7% and will reset to around 10%. Who got these 1 - 2% teaser rates on 2/28 or 3/27 Payment Option ARMs?