Fannie / Freddie Mortgage Principal Reduction Rumor...

[Jhhnn]

I'd be surprised at that. The material cost hasnt dropped 40% since 2006. My dads friend is a builder. The cost of building a house has remained pretty steady in MN at about 115-125\sq foot.

But what he and many other builders are doing is buying homes on auction because they cant build them that cheap.

Yeh, but I'll bet that the price of subcontracted labor for many parts of the process aren't nearly as low as in Arizona, where many construction sites don't have anybody on hand who's a native english speaker... Which doesn't stop Arizonians from scapegoating illegals in the slightest. They're great when you're making money off of 'em, however...

 

[hal2kilo]

Yeh, but I'll bet that the price of subcontracted labor for many parts of the process aren't nearly as low as in Arizona, where many construction sites don't have anybody on hand who's a native english speaker... Which doesn't stop Arizonians from scapegoating illegals in the slightest. They're great when you're making money off of 'em, however...

Yup, don't employ them and they will not come.

 

[Robor]

Well these programs are not designed for any flippers nor deadbeats.

Most people are oblivious to the qualifications because they are all bent out of shape.

This is why there really isn't any sense of community anymore and why we are so easily controlled.

I'm guessing any principal reductions would only be for the first mortgage of a primary residence.

 

[IronWing]

I'd be surprised at that. The material cost hasnt dropped 40% since 2006. My dads friend is a builder. The cost of building a house has remained pretty steady in MN at about 115-125\sq foot.

But what he and many other builders are doing is buying homes on auction because they cant build them that cheap.

Cost of materials here didn't change drastically here during the boom (except for concrete which did shoot up). What changed was the profit margin for the builders. Most houses here are built by large builders building entire neighborhoods at once. It is not uncommon to have a two thousand house development built in a year or three. During the boom, builders were raising prices weekly as the bubble inflated. Now that it has popped they can still build but have to accept a lower profit margin and they can beat the foreclosure sales as well.

Also some of the crap they built here would never fly in MN, it's just too cold there for the casa piñatas. We watched houses go up with no walls. They would frame out the house, apply styrofoam insulation, tyvex wrap, chicken wire, and stucco. The only rigidity is in the stryofoam, not even chip board.

 

[Robor]

Yeh, but I'll bet that the price of subcontracted labor for many parts of the process aren't nearly as low as in Arizona, where many construction sites don't have anybody on hand who's a native english speaker... Which doesn't stop Arizonians from scapegoating illegals in the slightest. They're great when you're making money off of 'em, however...

Too true... I know a tree trimmer who is rabid anti-amnesty and anti-illegals yet he employs them because they are cheap and work hard.

 

[Jhhnn]

casa piñatas

I like it- gave me a chuckle...

 

[cKGunslinger]

So ummm, fuck McCain too?

Broader.

I think at this point you can pretty much say "Fuck the American people" and be more accurate than not. No one cares anymore.

 

[Jhhnn]

Too true... I know a tree trimmer who is rabid anti-amnesty and anti-illegals yet he employs them because they are cheap and work hard.

Well, yeh- if they were legal, they'd have Rights, and would probably want more money, too...

All the anti-illegal raving form the Repub leadership is pure misdirection. American Capitalists luvs their illegal laborers, and will fight to keep 'em that way...

Funny how they didn't do squat about it when they controlled both houses of Congress and the Whitehouse, too...

What does it mean, Mr Wizard?

 

[piasabird]

How about equal treatment under the law? Giving special treatment for only people with the government loans is illegal. This is pure baloney.

 

[Jhhnn]

How about equal treatment under the law? Giving special treatment for only people with the government loans is illegal. This is pure baloney.

Heh. The govt owns the GSE's through a process called conservatorship. They don't own the banks. If the banks want to engage in similar programs, they're free to do so. Some do, with loans they hold themselves. It's more complicated wrt loans whose income streams have been bundled into MBS, held by investors. The govt is guaranteeing the returns of investors in GSE paper, even if they reduce principal to some debtors. The banks are doing no such thing wrt mortgage paper they sold and administer on behalf of investors- it'd cost them money, and wasn't a part of the original deal, at all... they guaranteed nothing, and they're sticking to that...

Unless you think that the govt should take on the responsibility of insuring returns for non-GSE paper, too... given what I know about your pov, that seems unlikely...

 

[ebaycj]

You have no idea how upset and sick this makes me. Furious is not the word. Throwing and breaking things doesn't begin to approach it.

I have a house. It's almost identical to my neighbors - just a shape difference on the exterior sets us apart. Built within a month of eachother, by the same builder.

When I bought the house, I put 15 percent down. My neighbor put 1% down, got a second mortgage, built a 1800 square foot pole barn, bought a large 5th wheel camper, a new Chevy Silvarado, 3 4-wheelers for his kids, and installed a pool.

I've never missed a payment, and in fact have been putting more than the minimum in.

He's missed a ton of payments.

When I tried to refinance from my 5.5% down to the current rates (around 4.0%), I could not because I did not qualify for any of Obama's government assistance programs, and I'm upside down on my house despite my initial 15% down payment.

Not only did my neighbor get his refinance, but because of his distressed state he got a large part of the debt forgiven. He now has nearly the same equity in his house than I do because of improvements he made and the debt fogiven, AND he has a lower interest rate. His refinance lowered his payments so that he pays the same that I do.

FUCK. YOU. OBAMA.

So would you still be super pissed if this "Stimulus Round 2" doubled back and let *you* have a principal reduction so you are able to refinance your house at 4.0(ish)% ?

 

[Jhhnn]

So would you still be super pissed if this "Stimulus Round 2" doubled back and let *you* have a principal reduction so you are able to refinance your house at 4.0(ish)% ?

Remarkable that Pulsar is cursing Obama because he got screwed from buying during the Ownership Society! looting spree, huh? Guess what? His self-regulated free market banking heroes will be looting his wallet for some time to come, as well...

The basic sentiment on the Right is, as usual, pure short sighted selfishness. If the other guy gets a break and they don't, they're jealous and resentful. It's all about <Me!>, right? Forget that the only reason the other guy gets a break isn't personal, at all , but rather an effort to salvage a systemic failure that they helped create by being chumps for repub rhetoric in the first place.

Families currently getting any kind of break at all aren't really getting any sort of great magnanimity from the system. They're still chained to the oars of the great galley of international capitalism, the ship of state of the lootocracy. The guys with the whips just let 'em choke up on the oar a little because they couldn't find anybody else to pull it even that hard...

<Whipcrack!> Row, you debt slave suckas, Row!

 

[Exterous]

Banks know what you can afford more than the vast majority of people do. After all that is their job, to price "risk". They are just as responsible for loaning money to people who couldn't afford it as those who took the loans.

If I loaned $100 to a crackhead today and bitched about not getting paid back would you think that we deserved at least equal blame (I should have known better than to loan a crackhead money but that still doesn't relieve the crackhead of their responsibility to make good on the agreement). It gets worse when you start loaning money to people that you know for a fact couldn't possibly pay you back even if they desired nothing more than to make good. IMO, that makes you more irresponsible than the person you loaned the money to.

I will give you that there are probably some anecdotal cases out there of people who they knew couldn't pay back the mortgage getting approved but the vast majority seem to be people who have steady jobs. You have to prove employment to get a house loan

There is no reason a bank should know more about what you can afford than you do. You should be able to figure out your income and how much your bills are/will be (or approximate in terms of utilities), how much you spend on grocieries, going out to eat, car payments etc. If you do not know how much house you can afford you are just being lazy when it comes to finances (which I cannot understand at all - why would you be lazy when it comes to money?! That's just asking for trouble and you have no one but yourself to blame when it comes knocking) or, just plain out, an idiot who probably shouldn't own a house anyway

The only thing you might not know is recommended amounts to spend on a mortgage as a percentage of your income or be suprised at how many little things you need when you own a house. At most a couple of hours of research will answer these questions

 

[Doc Savage Fan]

I've got to image that even some of the staunchest liberals here are beginning to wonder where all this money is coming from and who'll actually be paying the piper when he comes calling.

 

[spidey07]

This may be more than just a rumor. I've been reading a few articles about how the government wants to "fundamentally transform" the mortgage industry. This could include a full government take over or a hybrid public/private system similar to today but without fannie/freddie.

Maybe that's why they didn't touch FF in the financial regulation bill. The next bill will use the failure of FF to push government take over of mortgage industry. Never let a good crisis go to waste...