Underwater homeowners get no interest loan for up $50,000....

[LegendKiller]

Yeah, I'm a leech for getting back what I paid for with MY MONEY.

So your wife's bloated salary, which pays for your house, is OK, as long as you "get yours"?

Typical ME ME ME ME ME selfish and hypocritical Repuglicans. You are a fucking liberal, just admit it, you will take what you can get because you feel ENTITLED to it, as you pretty much said above.

 

[Jhhnn]

As usual, Righties don't get it. The money goes directly to the mortgage servicers who distribute it to investors, themselves included. Individual homeowners are just pawns in the scheme to stretch out/ prevent some foreclosures. Their loan balances are affected only marginally on a 30 year note. It's just a catch up and partial payment moratorium for them.

Let's say that the homeowner is a year behind on a $2000/mo mortgage. With late fees and penalties, they're behind ~$30K, which will go straight to the servicers. Then they'll receive a maximum of $833/mo assistance for 2 years, at which point the payment goes back up to $2K. Miss a payment, & they're screwed, the deal is off. Can't hack the payment when it goes back up? screwed again, because in either case they now owe more proportionately against the original $50K.

Investors get a cash infusion & no incentive towards short selling or actual forgiveness of part of the outstanding balance. Some foreclosures go on hold, reducing the glut of housing available.

The fact that a few homeowners may stay in their houses isn't the point of it, at all. It's about the investors. It always has been, bailout-wise.

OutHouse is right about one thing- being underwater doesn't mean people are deadbeats, it just means they're stuck, and that the financial elite has 'em by the balls. People who really can't pay are one kind of deadbeat, People who default strategically, put it to the man, are another. They figure if the situation were reversed, that the banks & investors would do the same to them, and they'd probably be right.

 

[drebo]

OutHouse is right about one thing- being underwater doesn't mean people are deadbeats, it just means they're stuck, and that the financial elite has 'em by the balls. People who really can't pay are one kind of deadbeat, People who default strategically, put it to the man, are another. They figure if the situation were reversed, that the banks & investors would do the same to them, and they'd probably be right.

The bolded may be true, but the rest of it is bullshit.

If you're not looking to sell, why does it matter how much your house is "worth"? If you can make your payments and you agreed to pay $x per month for 30 years to buy this house, that was an agreement you made and you should be held to it, regardless of the arbitrary property values in your neighborhood. Only if you plan to sell your house does it matter how much it's "worth". Also, I find it extremely hard to believe he bought his house 12 years ago and his maximum equity was $40k and he's now $40k underwater. That just doesn't match housing price trends. At peak (2007), his house should have been worth double or more, and at this point, it should be worth about the same. IMO, guy's a fucking liar and a deadbeat.

This "blame everyone else" attitude is fucking stupid. OutHouse made a committment and now he doesn't want to go through with it. Well, if that's the case, walk away from the fucking house. Don't expect me to pick up your buyer's remorse tab.

If the government REALLY wanted to stimulate the economy, they should have put money back into the hands of CONSUMERS. Tax rebates for everyone that PAID taxes. Giving tax money to corporations that made bad decisions is just plain fucking stupid, because they're just going to make those same decisions. Giving that money to them on behalf of people who made bad decisions is 10 times worse.

Fuck the banks, fuck the homeowners that should be foreclosed on, and fuck this administration and the last administration and congress for pandering to the fucking morons that destroyed our economy in the first fucking place.

You want to know how to save the economy? Let consumers spend more of their own fucking money and stop trying to save people who cannot be saved.

How many people in the last mortgage assistance program ended up getting foreclosed on anyway? Meanwhile, the banks got more and more of my money and housing prices stayed bloated. Well, fuck them all.

 

[boomerang]

Subsidized housing in Fairfax, VA.

Be sure to click on the link to see the photos.

 

[Dulanic]

Subsidized housing in Fairfax, VA.

Be sure to click on the link to see the photos.

Fucking disgusting. But isn't this a bit OT from this thread?

 

[boomerang]

Fucking disgusting. But isn't this a bit OT from this thread?

Yup, but the thread is about our government and its irresponsible spending so I feel it's related. Also IMO, the thread has about run its course. Finally, so what?

I also wanted to post it and didn't think it warranted a new thread.

 

[Doppel]

Many who are in houses getting what amounts to free money have had their chance, they should get booted. If the house drops value then those previously priced out (like younger people) will have a chance. This government is spending too much money and too much time trying to hold up the house of cards.

If you're hugely upside down, either keep paying, or don't. And if you can't, you either lose the house unwillingly or strategically default. If I were underwater hugely I'd certainly consider a strategic default. It's legal and it's moral; you pay the penalties, knowingly, as outlined in your mortgage contract.

As hinted, though, is this really a bailout for consumers or more tax money thrown at banks?

 

[Darwin333]

Yep, it just has "bad idea" written all over it. If they are behind and can't make payments, how in the world are they going to make payments on this loan even if it's 0%?

I on the other hand could use that 50K at 0% and I WILL be able to pay it back. I could use it for additions to the house putting plenty of people to work. But no, common sense or even basic economic knowledge of this administration is severely lacking.

I am not sure that you get it.

They know that most of these homeowners will not be able to pay back the loan but they don't care because that isn't the point. They know that the 0% loans could be put to much better use by people with the means to use it in constructive ways and pay it back but that isn't the point either.

The entire point is to help the banks out. That is it and for that purpose the program will work flawlessly. The pretending to help homeowners part is simply to make everyone else a little less pissed off about it and that part is working flawlessly too. Is anyone in this thread really pissed off about this program being nothing but a backdoor bailout to the banks? Nope, yall are all bitching about some poor joe getting a handout when it is really the banks who are getting the handout. The $8K homebuyers credit was the exact same thing.

It is working exactly as they had planned.

 

[datwater]

I fucking hate this country some times. How many more fucking hand outs are we going to give the irresponsible? Where is my fucking hand out for sticking it out with a upside down mortgage working full time and making my fucking payments? This shit is making me beyond furious how the people who do the right thing get fucked and the people who don't get rewarded. Fuck it why don't I just quit my job and forclose on my house. I would be better off!

+1

 

[Darwin333]

How many people in the last mortgage assistance program ended up getting foreclosed on anyway? Meanwhile, the banks got more and more of my money and housing prices stayed bloated. Well, fuck them all.

Ding ding ding.

The banks will still end up with most of these houses but in the meantime they will have collected an average of $35K extra on that property they wouldn't otherwise have, courtesy of the US tax payer.

I bet in at least half of the cases this is a royal fucking for the actual homeowner because if they fuck up within the first few years, which is very likely, they now owe even more and Uncle Sam is pretty good at collecting.

 

[Darwin333]

As hinted, though, is this really a bailout for consumers or more tax money thrown at banks?

The bank is guaranteed to get the money free and clear.

The homeowner is very likely to end up in foreclosure anyway just at a later date. When that happens they will now owe even more money. From what I have read this makes it even harder for them to recover if they should get behind again.

One party is getting a sweetheart deal and the other is very likely to get boned even harder than they currently are. I will let you decide which is which.

 

[JTsyo]

i live in a very modest home and the 12 years that i have lived here i have never missed or been late on a payment. nobody in my immediate circle of friends or family looked at their home as a investment and were not "hoping" it goes up a lot. until a few years ago one thing could count on was your home value to be more than what you paid for it either by a little or a lot it always went up. my home is now valued LESS than when i bought it what did I do wrong? i bought well within my means and i make my payments on time.

my financial's are just fine i will continue to make my payments hell i only have 18 more years to pay for it. my mortgage is cheaper than renting a house or apt and it would be crazy to walk away when i can make payments just fine. I just take issue that a lot of you are calling underwater home owners deadbeats.

if the government is offing free money hell yea im going to apply, one would be a moron not to. this program is to help homeowners who are temporarily and involuntarily unemployed or underemployed due to economic conditions or a medical condition, and are at risk of foreclosure. If our government can send BILLIONS of our money overseas that ends up in some warlords coffer, i have absolutely no issue with our government helping out its own citizens.

I don't think anyone has a issue with those are just underwater but those that are upside down and now can't make the payments. The trouble is all those that took out those attractive ARMs with plans to sell but are now stuck. Those those keeping their house it isn't as big a deal, just hope you don't need your home equity for anything. Hopefully this experience makes an impact on the American psyche that real estate is a no risk investment.

 

[IceBergSLiM]

this is just cooking the books so they can turn out more fake recovery stats.

 

[werepossum]

The bolded may be true, but the rest of it is bullshit.

If you're not looking to sell, why does it matter how much your house is "worth"? If you can make your payments and you agreed to pay $x per month for 30 years to buy this house, that was an agreement you made and you should be held to it, regardless of the arbitrary property values in your neighborhood. Only if you plan to sell your house does it matter how much it's "worth". Also, I find it extremely hard to believe he bought his house 12 years ago and his maximum equity was $40k and he's now $40k underwater. That just doesn't match housing price trends. At peak (2007), his house should have been worth double or more, and at this point, it should be worth about the same. IMO, guy's a fucking liar and a deadbeat.

This "blame everyone else" attitude is fucking stupid. OutHouse made a committment and now he doesn't want to go through with it. Well, if that's the case, walk away from the fucking house. Don't expect me to pick up your buyer's remorse tab.

If the government REALLY wanted to stimulate the economy, they should have put money back into the hands of CONSUMERS. Tax rebates for everyone that PAID taxes. Giving tax money to corporations that made bad decisions is just plain fucking stupid, because they're just going to make those same decisions. Giving that money to them on behalf of people who made bad decisions is 10 times worse.

Fuck the banks, fuck the homeowners that should be foreclosed on, and fuck this administration and the last administration and congress for pandering to the fucking morons that destroyed our economy in the first fucking place.

You want to know how to save the economy? Let consumers spend more of their own fucking money and stop trying to save people who cannot be saved.

How many people in the last mortgage assistance program ended up getting foreclosed on anyway? Meanwhile, the banks got more and more of my money and housing prices stayed bloated. Well, fuck them all.

This. If one's house is upside down, that's a chance one takes by investing in real estate. Like stocks, you have lost nothing until you sell, and if well-maintained and not in a declining neighborhood, chances are the value will eventually recover. However, there is no inherent right to have one's home appreciate.

Subsidized housing in Fairfax, VA.

Be sure to click on the link to see the photos.

This is one of the things that most steams me. I purchased a modest house that I could afford and paid it off, but far too often I'm called upon to help fund nicer houses for others. When we subsidize bad or dumb behavior, we WILL get more of it.

I applaud government trying to make affordable housing for the poor, but it should be housing that they can truly afford, small but well-built homes with few amenities. Subsidizing the poor into higher value developments merely makes those units harder to afford for those pulling their own weight - and greatly lowers the desirability to buy those units.

 

[wirednuts]

dude why you gotta be unemployed? i would be better off if i just quit my job now to get this loan, then ill go back to work right after. what a joke.

the people like me who have done EVERYTHING possible, everyday, to get in all my bills every single month. that means no beer till the weekends, maybe. no new computers. no eating out. life has been shit the last few years, so lets take care of the people who just give up.

 

[OutHouse]

I don't think anyone has a issue with those are just underwater but those that are upside down and now can't make the payments. The trouble is all those that took out those attractive ARMs with plans to sell but are now stuck. Those those keeping their house it isn't as big a deal, just hope you don't need your home equity for anything. Hopefully this experience makes an impact on the American psyche that real estate is a no risk investment.

that i agree with. ARM's were nothing more than a vehicle for the banks to get you to buy more house than you could afford.

well it sorta is a big deal to be underwater. i can not refi for a lower interest rate and if i had a better job opportunity offered to me in another state i cant sell. so i guess the best course of action is to keep making payments and my wife to get a job to get our house paid off sooner.

10 years ago i said then that the morons who were buying 400K homes on a 70K year salary were fucking morons and the did it with ARM's and balloon payments. those are the ones who fucked up, there was no way i was going to go in debt that much just for a "brand new house" in a HOA with 250 a month fees. The thing is that was what most houses were going for in the denver metro area. even a house built in the 50's had an absurd price. thats why i bought 35 miles outside of denver and got a new house that was well with in my means.

 

[IceBergSLiM]

Things will never get better if the market isn't allowed to correct itself without interference. The foreclosures and subsequent bank sell offs must happen.

 

[Jhhnn]

The bolded may be true, but the rest of it is bullshit.

If you're not looking to sell, why does it matter how much your house is "worth"? If you can make your payments and you agreed to pay $x per month for 30 years to buy this house, that was an agreement you made and you should be held to it, regardless of the arbitrary property values in your neighborhood. Only if you plan to sell your house does it matter how much it's "worth". Also, I find it extremely hard to believe he bought his house 12 years ago and his maximum equity was $40k and he's now $40k underwater. That just doesn't match housing price trends. At peak (2007), his house should have been worth double or more, and at this point, it should be worth about the same. IMO, guy's a fucking liar and a deadbeat.

This "blame everyone else" attitude is fucking stupid. OutHouse made a committment and now he doesn't want to go through with it. Well, if that's the case, walk away from the fucking house. Don't expect me to pick up your buyer's remorse tab.

If the government REALLY wanted to stimulate the economy, they should have put money back into the hands of CONSUMERS. Tax rebates for everyone that PAID taxes. Giving tax money to corporations that made bad decisions is just plain fucking stupid, because they're just going to make those same decisions. Giving that money to them on behalf of people who made bad decisions is 10 times worse.

Fuck the banks, fuck the homeowners that should be foreclosed on, and fuck this administration and the last administration and congress for pandering to the fucking morons that destroyed our economy in the first fucking place.

You want to know how to save the economy? Let consumers spend more of their own fucking money and stop trying to save people who cannot be saved.

How many people in the last mortgage assistance program ended up getting foreclosed on anyway? Meanwhile, the banks got more and more of my money and housing prices stayed bloated. Well, fuck them all.

First off, I think you've misinterpreted & misrepresented OutHouse's remarks. He intends to stay in his house, recognizing that his payments are actually cheaper than rent, and also that he will eventually end up clear of debt wrt that house.

The macro problem with negative equity is that it interferes with the normal turnover in housing, inhibits proper resource utilization. Young families who are doing well can't trade up, and near seniors, empty nesters, who'd downsize if they could are also inhibited. Got a great promotion offer from the company in another state? Can't take it. Want to tap your equity to send the kids to college? There isn't any.

The whole situation is a result of tax & business policy that has bifurcated the economy. The very well to do achieved enormous excess funds, creating demand for financial instruments, which are basically debt instruments. Bankers responded by creating debt in the general population, more than debtors can actually support, and profited on the transactions, then profited on the fall with synthetic hedging. Many of those institutions are insolvent, or nearly so, but the perps themselves are wealthier than ever. The FRB & the Bush Admin cheered them on the whole while.

Current efforts revolve around protecting the principals, investors, and the rest of us only indirectly, with the exception of some struggling debtors. It's still all trickledown all the time, which is how we got into this mess in the first place.

Some program homeowners will use the opportunity to recover, some will be unable. At worst, the latter will stay in their homes a little longer, postpone bankruptcy for awhile. When that happens, it really doesn't matter if they owe $20K or $2M, because they'll take the same beating either way.

 

[drebo]

Current efforts revolve around protecting the principals, investors, and the rest of us only indirectly, with the exception of some struggling debtors. It's still all trickledown all the time, which is how we got into this mess in the first place.

Houses are overvalued and have been for the last 10+ years. Fixing the problem involves people realizing that houses are overvalued and allowing them to go back down to market sustainable levels. Trying to keep a punctured balloon afloat is a recipe for failure.

More importantly, though, who is responsible for driving up the costs of homes? Banks, investors, the ignorant/stupid who took loans without knowing what they meant and what the ramifications of those loans were, and the brokers who pushed those loans. Why should economic relief be directed toward those who caused the problem? The fucked up and they should lose their fake, bloated perceived "wealth".

Protecting the principle is a terrible rationalization to giving tax dollars to banks. It's just encouraging the same behavior. I, for one, would rather housing not be in a bubble. If that means that Citigroup has to only post a $2 billion profit this year, rather than a $5 billion profit, then so be it. Citibank, and banks like them, were one of the roots of the problem. They should not be given a free pass.

 

[JD50]

did I miss something with regards to spideys wife? Unless she does a job that he thinks should be cut, he's not being hypocritical, you guys act like he's an anarchist and doesn't want any government at all. Even if he thinks her job should be cut its still not really hypocritical, might as well take advantage of it while it's there. Its no different than all the liberals that want higher taxes still paying the lower tax rate that they disagree with.

 

[Texashiker]

Houses are overvalued and have been for the last 10+ years. Fixing the problem involves people realizing that houses are overvalued and allowing them to go back down to market sustainable levels. Trying to keep a punctured balloon afloat is a recipe for failure.

If at all possible, the people that drive the market - banks, appraisers, real estate agents,,,,, are not going to let prices drop.

In 10 years, from around 1994 to 2004, I saw the home prices in my home town double. But the average wage did not double. Prices went from being affordable, to only the upper middle class to the rich being able to afford to buy a house there. It was really sad to see a community that was based on middle class homes, out price themselves to the middle class.

My guess is that the prices of housing will continue to drop until their affordable by the average middle class family.

 

[Jhhnn]

did I miss something with regards to spideys wife? Unless she does a job that he thinks should be cut, he's not being hypocritical, you guys act like he's an anarchist and doesn't want any government at all. Even if he thinks her job should be cut its still not really hypocritical, might as well take advantage of it while it's there. Its no different than all the liberals that want higher taxes still paying the lower tax rate that they disagree with.

Utterly ridiculous. Spidey knows he's a hypocrite, revels in it, seeks every advantage from it. He's the center of the Universe- Hell, the only reason that the Universe exists at all. And the whole bit about taxes denies reality. Let's say that people who think taxes need to be raised voluntarily pay more- increased revenues will just enable wing nuts to call for more tax cuts for themselves, so that those willing to pay more will necessarily pay even more... If the most selfish among us could pay nothing, they would, and if they could derive enormous income from govt contracts at the same time, hey, no problemo...

 

[PeshakJang]

If the most selfish among us could pay nothing, they would,

Most of those people already do that, and they work for Obama.

Fact234

 

[alphatarget1]

I fucking hate this country some times. How many more fucking hand outs are we going to give the irresponsible? Where is my fucking hand out for sticking it out with a upside down mortgage working full time and making my fucking payments? This shit is making me beyond furious how the people who do the right thing get fucked and the people who don't get rewarded. Fuck it why don't I just quit my job and forclose on my house. I would be better off!

Two words: strategic default.

 

[Jhhnn]

Most of those people already do that, and they work for Obama.

Fact234

Compelled to say something, anything, even if it's gibberish, right?