Wait... you're telling me a Democrat is looking to lower the bar and remove personal responsibility as an answer to an issue we face and in an effort to get votes? I am shocked I tell ya! 
ImpulsE69
Lifer
- Jan 8, 2010
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I sure as hell didn't. I was smart enough to laugh in the banks face (yes, we both actually laughed) when they told us how much we could 'afford' when looking for a house. This was back in 99 and we asked them then if people actually do that (referencing the 3x income statements)? I was young, and not even college educated and knew that was insane. When the housing crisis hit, I honestly didn't even understand why it was an issue, but we know what the real issue was. Morons who wanted more than they could afford (and a corrupt system).
Same with student loans (granted I went to college later in life) I paid them. Lack of common sense and a false sense of entitlement is what is the issue here. Thus my take that saying, oh you aren't making 100k a year right out of college, here's your tuition back!.....yea..that will teach them responsibility...
I'd be much more in favor of free college for all, but we all know how that would go, it would end up about as good as public schools.
Vic
Elite Member
- Jun 12, 2001
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So.. what you suspect and what is reality are 2 very different things. Mortgages aren't car loans. They are subject to very different laws and regulations, some federal, all state.
Most states are non-recourse for primary residence first mortgages with regards to that 'fat bill,' also known in debt circles as the 'deficiency balance.' 'Non-recourse' means that the lender must accept the funds received from the foreclosure auction as settlement of the debt in full, even if those funds are less than the balance owed. In those cases, the lender does charge off the deficiency balance and issue a 1099 to the borrower for that amount, because the IRS does define the portion of a debt not repaid as income. However, if the foreclosed mortgage was used to purchase the property, then that 1099 is not taxable income per the Mortgage Forgiveness and Debt Relief Act.
In those states that do allow lender recourse for primary residence first mortgages, the lender must pursue a more costly and lengthy judicial foreclosure process (required in many states anyway), and then must be awarded a deficiency judgment in court in order to pursue the deficiency balance. These are not that common.
In all cases, this varies by the laws of the state the property is located in. Generally, as the time it takes to foreclose and repossess the property is the most expensive part of the foreclosure process by far (because the process can take years, interest never sleeps, and defaulted borrowers rarely pay the property tax and insurance bills), a lender's primary objectives are to cure the delinquency (ie through loan modification), to settle the account (ie short sale), or to foreclose, as quickly as possible. And yes, in that order, ideally. Keep in mind that settlement of a non-performing asset often makes more sense wasting good money chasing after bad.
But yeah, I don't know anything about how this stuff works.
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Vic
Elite Member
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jackstar7
Lifer
- Jun 26, 2009
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It’s interesting to me that just about everyone accepts that a failed business loan should be discharged but conservatives think failed education loans shouldn’t be.
From an economics perspective I’m struggling to find a difference. From a political perspective though, that difference is clear.
From an economics perspective I’m struggling to find a difference. From a political perspective though, that difference is clear.
ImpulsE69
Lifer
- Jan 8, 2010
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He is part of the problem and he considers this 'smart'. This was my point earlier regarding bankruptcies.
And how in the hell does any of that equate to "debt forgiveness" in anyway ?
You made that statement as if there was some kind of act imposed to help folks that were underwater during the great recession.
That isn't debt forgiveness, that is simply the laws and regulations that have always been in place (and that are on a local law level - meaning on a case by case basis).
Vic
Elite Member
- Jun 12, 2001
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Were those debts settled without having been repaid in full? Yes. Thus, debt was forgiven. Or 'cancelled,' as we prefer to call it. And I haven't even brought up all those who got principal forgiveness modifications, ie the lender forgave a portion of their mortgage balance, recast their payments, and they got to keep their homes. And now, just a few years later, their 'underwater' homes are worth more than ever!
But hey, I'm so glad that an 'internet expert' like yourself was here to set it straight.
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Vic
Elite Member
- Jun 12, 2001
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Amazing how this was just a few years ago and everyone seems to have forgotten all about it.
Here's the IRS page discussing the program and the non-taxable status of the forgiven debt: https://www.irs.gov/newsroom/princi...nder-the-home-affordable-modification-program
Here's the program's official website: https://www.makinghomeaffordable.gov/pages/default.aspx
The program's page on wikipedia: https://en.m.wikipedia.org/wiki/Making_Home_Affordable
HAMP (the modification program) ended 12/31/16 and HARP (the refinance program) ended 12/31/18, but they were very much real.
sportage
Lifer
- Feb 1, 2008
- 11,492
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For Warren's plan to work she'd not only need to get elected, she'd need a Democrat super majority in both the house and the senate.
And knowing the fickleness of Democrats in general, even with a super majority I doubt those Democrats would go along with it.
Remember those "blue dog" democrats that taunted Obama.
Remember the power of lobbyist.
Remember the Alamo.
Remember Alamo car rental.
Remember no collusion, no obstruction.
And knowing the fickleness of Democrats in general, even with a super majority I doubt those Democrats would go along with it.
Remember those "blue dog" democrats that taunted Obama.
Remember the power of lobbyist.
Remember the Alamo.
Remember Alamo car rental.
Remember no collusion, no obstruction.
Vic
Elite Member
- Jun 12, 2001
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I am no fan of Warren, and would consider voting for Trump if she got the Dem nomination (seriously), however, her motivations here are not altruistic and we're likely to hear more of this from other candidates. Besides performance issues, another problem with student loan debt is that it's keeping the younger generation from being able to qualify for mortgage financing and become homeowners. There's been a big push from Fannie Mae going on to fix this problem.
Yeah, sorry, not quite seeing how those equate to "debt forgiveness".
I will fully concede to you however, there were apparently a few programs that the government intended to "help" people - But still I can't concede that there is anything here related to debt forgiveness. Seems more related to reducing their monthly payments if anything.
As has been said numerous times - in the great recession homeowners got bent over and reamed - banks sure as fuck didn't.
Precisely right. Democracy is based on the concept that a million stupid people will make better decisions than one stupid person. We've add to that problem by allowing vast sums of money to influence the outcome of those elections. On top of that, millions have jumped on the social media band wagon, arguably the worst thing to happen to rational thought since the discovery of the concussion.
Sorry, but thinking one deserves to have an $80k education from a University, then expecting to not have to repay that debt, is the epitome of entitled. One advocating for the erasure of someone's personal responsibility is enabling them. Grow up. There are plenty of ways to get an education without that kind of overhead. The pains of our decisions is a necessary evil by which we learn to be responsible adults. Although I might add that there could be a bankruptcy escape clause allowed.
Oh you weren't aware of our residential mega expert on all financial related things (not talking about Vic, talking about a certain poster that has regularly claimed he knows more on basically every single financial related topic that gets discussed on here, than people that do that shit for their fucking jobs, like Vic)?
Blackjack is just going off the deep end. He's turning into the twins where they're capable of using logic, but the information they're using to inform that logic has been so thoroughly poisoned that its causing them to argue completely opposite of reality, to the point of stupidity.
I see a collection of other usual suspects trying and failing hilariously to do what I said conservatives were failing at doing to try and derail the honest discussion being had.
brandonbull
Diamond Member
- May 3, 2005
- 6,365
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I get that, and I agree, but I think education debt is an issue on its own that needs to be addressed, so really I think its two separate issues. I think the idea is that education debt is gumming up more than the education system, so offering a debt forgiveness plan, would provide short term relief, while we work on dealing with the inherent issues in the education system that led to the debt issue.
I'd agree that measured, targeted change would be best for the education market. The problem is that, it requires the same political will to get that as to get the big changes that might help with the fundamental underlying issues and because of frustration over the lack of small things being done as they arise that it drives people to push for big changes.
At this point, seemingly the only thing that can produce any actual changes (that isn't just further redistributing wealth to the wealthiest) is a Democratic majority. But because Americans keep voting Republicans (who are openly just trying to fuck over most people - while they simultaneously gloat about it but then lie when people call them on it - to the benefit of the people that need it the least), even that just leads to further problems as anything the Democrats do the Republicans then just spend their entire time in office trying to fuck over (even if they fail literally hundreds of times to do so, which then just pushed them to go more extreme to get the power where they can fuck it over). When Republicans have the majority they do fucking nothing but try and fuck shit up, while having no plans for how to fix anything, but damnit they need a wall! That'll fix everything!
Vic
Elite Member
- Jun 12, 2001
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Sorry, I'm just not a fan of Warren. She is IMO the weakest possible candidate for next year.
I do believe that college education financing needs to be completely reformed though. The current system has too many flaws. Ideally, I would like to see a system based on academic merit first, and the ability to pay a distant second. Along with increased funding to public universities, under the condition of correspondingly reduced tuitions (which would put pressure on private schools to do the same).
I acknowledge that there is really no way to achieve that without some large scale cancellation of existing student loan debt, as those borrowers are going to be less willing to pay when other people are getting a subjectively better deal. But that would free up those people to move on to buying homes, etc.
Overall, big bump for the economy, but wouldn't pay for itself at first.
Vic
Elite Member
- Jun 12, 2001
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ivwshane
Lifer
- May 15, 2000
- 33,739
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I don't know if you are being serious but if you are then I feel sorry for you because the Obama admin did have a program for under water mortgages for people who were making their payments. It basically allowed people to refinance with no fees. I cut my rate from 4.5-3.25%.
The program ended in December 2018.
https://www.harp.gov/about
Edit: Vic beat me to it
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