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Nubbs
08-31-2007, 10:55 AM
http://www.msnbc.msn.com/id/20524454/
What on earth is going one here? Is it the governments job to bail out people who were stupid enough to buy houses under terms they can no longer meet? I think this is pure BS. Anybody else with me?

YeLLowBoaT
08-31-2007, 10:59 AM
I agree, I feel the same out the Morage industry... they did it to themselfs...

LhcBrad
08-31-2007, 11:09 AM
It looks like its time for me to buy how could i go wrong if i cant afford it the government will bail me out. It just does not pay to be smart any longer.
http://www.icantsellmyhouse.blogspot.com/

PaPaG
08-31-2007, 11:12 AM
never fails, make bad investments and the Gov will use our hard earned money and tax us to death to bail them out....

BEER&WATER
08-31-2007, 12:05 PM
to littel to late

BEER&WATER
08-31-2007, 12:08 PM
what would happen if everyone stoped paying the house payment ???? .that would put all things in order real quick

Partycattin
08-31-2007, 12:17 PM
Maybe I'll go out and buy a Ferrari that I know I can't afford, or maybe borrow money to start a business that probably won't be successful. If the gov't is going to bail everyone out when they take a risk and that risk fails, then no more risk right?
This is bogus. People either took an investment risk which may fail or they got in over their heads. Either way, the rest of us shouldn't have to bail them out.
I think the Mortgage companies need to find some creative ways to re-write some of these loans to make it a win-win. Even if the homeowner has to take on a 40-50 year mortgage for a while, they would be able to make the payment and keep the house until their financial status changes or they sell the place and find something they can afford.

YeLLowBoaT
08-31-2007, 12:29 PM
Maybe I'll go out and buy a Ferrari that I know I can't afford, or maybe borrow money to start a business that probably won't be successful. If the gov't is going to bail everyone out when they take a risk and that risk fails, then no more risk right?
This is bogus. People either took an investment risk which may fail or they got in over their heads. Either way, the rest of us shouldn't have to bail them out.
I think the Mortgage companies need to find some creative ways to re-write some of these loans to make it a win-win. Even if the homeowner has to take on a 40-50 year mortgage for a while, they would be able to make the payment and keep the house until their financial status changes or they sell the place and find something they can afford.
even a 40 or 50 year note will not help... there is very little diffrence in your payments...
example... a 30 year at 6% for 300k is just under 1800. For 40years its 1650 for 50 its 1600. at 8% ( which alot of people are now facing do to the ARM comeing to term) 30 years is 2200, 40 years is 2100 and 50 years is 2050.
The good new is they are talking about droping the rate another .5% next month. The bad news is alot of the "whole sale debt"( of which there are tons) buyers are not going to drop thier rates unless they are forced to( IE goverment steps in)

speedneeder
08-31-2007, 12:33 PM
Maybe Bush is over reacting. From what I've been told we are merely having a minor pricing "correction". I know I've read that here over and over.:rolleyes:

NoWorries
08-31-2007, 12:50 PM
I have to agree with everyone here, I do not think the gov needs to interfere in this situation, this coming from a guy who makes a living selling real estate.:idea: However at the end of the day we live in a capitalistic free market society in which the consumer drives the market up and down. I am not even going to try and get into an economic discussion because someone on here knows way more about it then I do. The lending (real estate) market is cyclical and will right itself like it has done in the past. In the meantime there are some great freaking deals out there from land to commercial and everything in between :D if you can get qualified:D

LhcBrad
08-31-2007, 12:51 PM
I am steaming mad about this!!!! Way back in 2002 i could no longer afford my home and i HAD to sell it due to 9-11 and business slowing down (i sold tourist items and the tourist just stopped traveling.)I was smart enough to sell and move to a cheaper place in country.I regrouped and am doing much better now.The point i am trying t make is i thought for myself and recovered by myself. Its amazing how fast this nation is sinking. Its not a republican-democratic issue any longer they both are the same.
Rant over!!!!!!!!!!!!!!

NoWorries
08-31-2007, 12:55 PM
Brad,
You are right it is not a Rep or Dem issue they are so far apart they are actually meeting on the other end of the spectrum.:jawdrop:

LhcBrad
08-31-2007, 01:00 PM
On a serious note the only good thing is that i just might be able to own another home in Lake Havasu.I am for sure looking around and i even have a savings. Imagine that!!

C-2
08-31-2007, 01:18 PM
Maybe Bush is over reacting. From what I've been told we are merely having a minor pricing "correction". I know I've read that here over and over.:rolleyes:
Hee hee.
Yup, in 3 months the market will be back to normal.
The real mutha fawkers are the banks. They raped people on the fees and prepayment penalties, sold the paper a few times, and now, will not have to absorb the loss - Fannie Mae will?
I still don't see how it can help, unless Fannie Mae re-writes their otherwise sound(?) underwriting.
As Yellowboat pointed out - what relief is available? Still can't clear the LTV values, and I doubt the government is going to insure a loan that's $100K upside down.
Smoke and mirrors, smoke and mirrors.

Insurance God
08-31-2007, 01:24 PM
I believe the intention is to protect the stock market and keep us from going into a recession.

desertbird
08-31-2007, 01:32 PM
http://www.msnbc.msn.com/id/20524454/
What on earth is going one here? Is it the governments job to bail out people who were stupid enough to buy houses under terms they can no longer meet? I think this is pure BS. Anybody else with me?
Did anybody read the articles today, or is this just a Bush Bash thread. He's a dope, but this is not a bail-out program. It sounds more like a way to let the banks take their licks, and the homeowners learn a lesson while they salvage what's left of their only investment. Homeownership should still be a nationwide goal, and is a root to a stable economy.
From the article:
“It’s not the government’s job to bail out speculators or those who made the decision to buy a home they knew they could never afford,” Bush said in the Rose Garden. “Yet there are many American homeowners who could get through this difficult time with a little flexibility from their lenders or a little help from their government.”
and this:
To qualify for the new program, being called FHA Secure, a borrower will have to prove the original loan was being repaid until it reset to a higher rate and they must have 3 percent equity in the home. The FHA does not supply the mortgage loan but it guarantees loans extended by banks and other lenders.
Still sound like a handout?:confused:
I think it sounds pretty fair....but what do I know, I got rid of my ARM 2 years ago when I refi'd, took the 2nd and bought the boat!!! :D :sqeyes: :D

Mandelon
08-31-2007, 01:35 PM
Things could get really ugly if nothing is done.....I agree its wrong to bail out knuckleheads, but the financial effects of doing nothing could be global.....

NoWorries
08-31-2007, 02:04 PM
I am a believer in our free market society but I am also a believer in our elected official often (i'll shoot myself after I type this) know more then we do :idea: , and desert bird appears to be correct.....any decision is better then no decision at this point.

a catered life
08-31-2007, 02:14 PM
I have to agree with everyone here, I do not think the gov needs to interfere in this situation, this coming from a guy who makes a living selling real estate.:idea: However at the end of the day we live in a capitalistic free market society in which the consumer drives the market up and down. I am not even going to try and get into an economic discussion because someone on here knows way more about it then I do. The lending (real estate) market is cyclical and will right itself like it has done in the past. In the meantime there are some great freaking deals out there from land to commercial and everything in between :D if you can get qualified:D
thats all you needed to say

HocusPocus
08-31-2007, 02:15 PM
this isn't a free get out of debt ticket, even if this thing happens it will only help out a few and only those who have good credit and only recently got behind on their payments. its not going to help out the wanna be speculators or those that got in way over their heads.

talkinghead
08-31-2007, 07:46 PM
The Chief Economist at Bank of America said today that even with the Bush programs and a cut in interest rates, housing prices should still continue to fall due to excess inventory.
I say let the market, and the market alone correct this problem.
But I guess were getting close to the next election.

Baja Big Dog
08-31-2007, 08:12 PM
Did anyone read the article? Most will say no..its not a bail out, it is financing through FHA, which was designed after the depression. This is only a loan through FHA, not a hand out, and you must qualify before you will see any money. This will eliminate many of the a holes that "overstated" there income ( or lied).
And the max available in California may go as high as $360,000!!! Come on folks, how many homes out of south central L.A. is that gonna help?
Most people in foreclosure proceedings will NEVER qualify because of negative hits on there credit rating.
GEEEEEZZZZZZ:mad:

YeLLowBoaT
08-31-2007, 09:01 PM
Did anyone read the article? Most will say no..its not a bail out, it is financing through FHA, which was designed after the depression. This is only a loan through FHA, not a hand out, and you must qualify before you will see any money. This will eliminate many of the a holes that "overstated" there income ( or lied).
And the max available in California may go as high as $360,000!!! Come on folks, how many homes out of south central L.A. is that gonna help?
Most people in foreclosure proceedings will NEVER qualify because of negative hits on there credit rating.
GEEEEEZZZZZZ:mad:
I did read the artical, and actaully its not going to help very many people.
Still its only for loans that had thier intrest rates spike= ARM/ intrest onlys(asumming you meet the other guild lines)
IMO you if you were counting on the intrest rates to stay low in order to afford your house, you fooked up. So it is a hand out( in that you can now afford the house that you could not before, do to a goverment loan)

C-2
08-31-2007, 09:06 PM
WASHINGTON -- President Bush, looking for ways to respond to the subprime-mortgage crisis, will outline a series of policy changes and recommendations today to help borrowers avoid default, senior administration officials said.
Among the moves will be an administrative change to allow the Federal Housing Administration, which insures mortgages for low- and middle-income borrowers, to guarantee loans for delinquent borrowers. The change is intended to help borrowers who are at least 90 days behind in payments but still living in their homes avoid foreclosure; the guarantees help homeowners by allowing them to refinance at more favorable rates.
Mr. Bush also will ask Congress to suspend, for a limited period, an Internal Revenue Service provision that penalizes borrowers who refinance the terms of their mortgage to reduce the size of the loan or who lose their homes to foreclosure. And he will announce an initiative, to be led jointly by the Treasury and Housing and Urban Development departments, to identify people who are in danger of defaulting over the next two years and work with lenders, insurers and others to develop more favorable loan products for those borrowers.
The moves are the first visible steps the Bush administration has taken to help stem the fallout from the subprime crisis, which has roiled financial markets and threatened to contaminate the housing sector. Defaults and foreclosures are increasing as borrowers -- many of whom got interest-only or no-money-down loans -- begin having trouble making their mortgage payments as higher rates kick in. Many homeowners believed they could refinance their loans, but that has become much harder as lenders tighten their standards in the face of defaults and foreclosures.
With more than two million loans expected to adjust to higher rates over the next two years, possibly triggering many more defaults, the Bush administration is looking for ways to stem the damage.
"The president wants to see as many homeowners who can stay in their homes with a little help be able to stay in their homes," a senior administration official said. "We're not looking for an industry bailout or a Wall Street bailout. The focus here is on the homeowner."
Mr. Bush is instructing Treasury Secretary Henry Paulson to look into the subprime problem, figure out what happened and determine whether any regulatory or policy changes are needed to prevent a recurrence.
For now, the administration's primary vehicle to help homeowners will be the FHA, which doesn't originate loans but helps riskier borrowers qualify by guaranteeing their loans against default. By allowing the agency to back loans for delinquent borrowers, the FHA estimates it can help an additional 80,000 homeowners qualify for refinancing in 2008, bringing its total of refinancing guarantees to about 240,000, senior administration officials said. Mr. Bush also plans to announce that the FHA will begin charging "risk-based" premiums, a move that will enable the agency to help riskier borrowers since they can charge those individuals higher insurance rates. Right now, FHA premiums are a flat 1.5% of the loan, and the change would give the FHA flexibility to charge some borrowers as much as 2.2%.
Still, the move will help only a small portion of homeowners -- and few in high-cost states such as California or New York -- because the FHA faces constraints on the size of the loans it can back and strict rules that borrowers must meet. The Bush administration has been pushing Congress to enact overhauls that would eliminate the required 3% down payment and raise the size of the loans the FHA can insure to as much as $417,000 from $362,790. Senate Banking Committee Chairman Christopher Dodd (D., Conn.) said recently that FHA reform will be among his priorities when Congress returns from its August recess, and a bill is expected to head to the full House this fall.
In another move, Mr. Paulson and HUD Secretary Alphonso Jackson have instructed their staffs to begin working with mortgage lenders and others to identify borrowers who are in danger of defaulting. They also are trying to work with private lenders and mortgage giants Fannie Mae and Freddie Mac to develop loans for borrowers who will likely face default if they can't get more flexible terms.
-------------------
Hmmmmm, here's the part which I think will only accelerate the problem:
Mr. Bush also will ask Congress to suspend, for a limited period, an Internal Revenue Service provision that penalizes borrowers who refinance the terms of their mortgage to reduce the size of the loan or who lose their homes to foreclosure.
Too me, that gives Cali owners even more motivation to either short sale, or simply walk away. Now you can do either, without getting nailed with a hefty tax bill.
Call me dumb, but how is that a good thing?

BILLET
08-31-2007, 11:15 PM
I dont know, I think I would rather see some people get some kind of help and maybe stabliize the housing market instead of watching my equity fly out the window every month because the guy next door to me just lost his house.

Nicked prop
09-01-2007, 06:21 AM
Still sound like a handout?:confused:
Why yes, as a matter of fact it does. What part of the government doling out tax dollars is difficult to understand?

Baja Big Dog
09-01-2007, 07:03 AM
Still sound like a handout?:confused:
Why yes, as a matter of fact it does. What part of the government doling out tax dollars is difficult to understand?
Again...read the facts, I would consider the govt "doling out" money as a bail out is wrong, I had to read the facts again and I still did not see the part where the govt is "giving" money away.
Its call a loan...that is to lend someone money with the anticipation that it will be paid back...a loan, not a handout!!!
Who wins in a situation like this....everyone!!! Is it fair? ...Its about as fair as death....because thats one of the two thngs in like we all must deal with!!
Its gonna piss off alot of people that can make the payments they signed up for originally, oh well, it gets down to not making all the people happy all the time.

Outnumbered
09-01-2007, 07:33 AM
Socialism, liberalism, etc. Just another program to make things more "fair".
Just wait until they take over health care:rolleyes: Do some research on how focked up the system is in Europe and Canada. What a train wreck:mad:

speedneeder
09-01-2007, 07:55 AM
BILLET I dont know, I think I would rather see some people get some kind of help and maybe stabliize the housing market instead of watching my equity fly out the window every month because the guy next door to me just lost his house.
Yesterday 10:06 PM
Doesnt make much of a difference to me other than I actually prefer the market less expensive so it doesnt drive my taxes up. I didnt buy my home to think of it as spending equity. as the prices rise. I bought it with the intention of paying it off.

talkinghead
09-01-2007, 10:14 AM
The gov't will lower interest rates and the RE mania will start all over again.

HocusPocus
09-01-2007, 10:14 AM
To qualify for the new program, being called FHA Secure, a borrower will have to prove the original loan was being repaid until it reset to a higher rate and they must have 3 percent equity in the home. The FHA does not supply the mortgage loan but it guarantees loans extended by banks and other lenders.
The maximum loan the FHA can guarantee in most states is $202,000 although that can rise to $362,000 in high-cost states such as California and New York.
do you think that alot of people are going to qualify for this "help"... i doubt it. how many homes do you know of in Cali that are under 362k and where the borrower using an ARM will have equity and a good credit rating? out of the 2 million or so adjusting ARMs this is suppose to help between 60-80 thousand which is like 4%. i bet the number ends up much smaller then that.
As another part of his mortgage package, Bush said he would support legislation pending in Congress that would temporarily change tax law to let homeowners avoid paying taxes on forgiven debt in loans being restructured by financial institutions.
for Bush to get anything thru congress even with the support of some Dems is pretty slim, many Dems have already stated that they didn't like the way the legislation is currently written.
this is far from a bailout and is only there to help some restructure and renegoiate their current loan. from what i understand some lenders are already doing this sort of thing.
for those folks that bought way over their heads and or got themselves in debt with toys, 2nds or HELOC's, well i wish them the best of luck because this isn't going to help them at all.
this whole deal is just some political talk to help calm the volatile stock market and make it appear that the president is in touch with some problems facing the low and middle income people.

3 daytona`s
09-01-2007, 10:17 AM
http://www.msnbc.msn.com/id/20524454/
What on earth is going one here? Is it the governments job to bail out people who were stupid enough to buy houses under terms they can no longer meet? I think this is pure BS. Anybody else with me?
Pissed and moaned and the market was off a little so send in the rescue squad.:idea: :confused:

Nicked prop
09-01-2007, 10:24 AM
Again...read the facts, I would consider the govt "doling out" money as a bail out is wrong, I had to read the facts again and I still did not see the part where the govt is "giving" money away.
Its call a loan...that is to lend someone money with the anticipation that it will be paid back...a loan, not a handout!!!
Who wins in a situation like this....everyone!!! Is it fair? ...Its about as fair as death....because thats one of the two thngs in like we all must deal with!!
Its gonna piss off alot of people that can make the payments they signed up for originally, oh well, it gets down to not making all the people happy all the time.
It turns out I did read it. Somehow folks have the simple-minded notion that the government provides money out of thin air--whether it's for this prgram or any other. The government has two major options to fund this: 1) create more national debt or 2) use existing tax dollars not previously budgeted for this program. Do a little research and you'll find neither approach is beneficial to those of us who've acted responsibly and lived within our means over the last several years. No, "everyone" doesn't win in a situation like this. Further, who is the guarantor of these loans used to bail out the "me generation"? Yeah, it's the government. Um, I mean, taxpayer. Sadly, I'm no longer amazed when folks can't make the connection between government spending (loans or otherwise) and taxes.
Ponder this one, if the government sees fit to help out those poor souls what about those that took advantage of the run-up in real estate? Should the government then penalize folks who made obscene profits (a number of my friends did) due to the availability of cheap loans during last several years? Some aleady astutely pointed out the banks have had a great run. Some lenders will also benefit from the bail out, some homeowners will benefit, and the taxpayer will pick up the tab. And yes, there will be a tab even if it's only the cost for setting up the program, implementing it, and adminstering it. And the goverment has a great track record for minimizing costs for those sort of things, doesn't it?
As for the government bail out preserving equity for the rest of us, that equity was artificially created by cheap loans. It's not up to the goverment to shore up fantasy land.
Next thing you know, the government will see fit to tide folks over after a rough weekend in Vegas. Imagine the support that program would generate!

cdog
09-01-2007, 10:45 AM
The fastest way to fix this problem is to raise the conforming loan limits to 500k. Cut the over night by .5 -1%. The issue right now is squeezing buyers and refi's into financing that wants a 1%+ risk premium for non conforming loans. Just like in the past. The markets are behind what's happening on the ground.
Example: The cheap rates were like steroids. Artificially pumping the market creating a UN earned increment, (equity). Now they cut 90% of loan products available just 4 weeks ago. Cold Turkey! This has to be let down gently or the problem will be catastrophic across the whole economy.
So far this FHA deal sounds like nothing but feel good legislation. The real problems start from about 350k to 750k. Financing got us into this mess and financing will have to get us out of it. Just wait until October when you hear on the news how bad Sept. was.

Tequila-John
09-01-2007, 12:38 PM
The fastest way to fix this problem is to raise the conforming loan limits to 500k. Cut the over night by .5 -1%. The issue right now is squeezing buyers and refi's into financing that wants a 1%+ risk premium for non conforming loans. Just like in the past. The markets are behind what's happening on the ground.
Example: The cheap rates were like steroids. Artificially pumping the market creating a UN earned increment, (equity). Now they cut 90% of loan products available just 4 weeks ago. Cold Turkey! This has to be let down gently or the problem will be catastrophic across the whole economy.
So far this FHA deal sounds like nothing but feel good legislation. The real problems start from about 350k to 750k. Financing got us into this mess and financing will have to get us out of it. Just wait until October when you hear on the news how bad Sept. was.
Well said.

YeLLowBoaT
09-01-2007, 01:07 PM
The fastest way to fix this problem is to raise the conforming loan limits to 500k. Cut the over night by .5 -1%. The issue right now is squeezing buyers and refi's into financing that wants a 1%+ risk premium for non conforming loans. Just like in the past. The markets are behind what's happening on the ground.
Example: The cheap rates were like steroids. Artificially pumping the market creating a UN earned increment, (equity). Now they cut 90% of loan products available just 4 weeks ago. Cold Turkey! This has to be let down gently or the problem will be catastrophic across the whole economy.
So far this FHA deal sounds like nothing but feel good legislation. The real problems start from about 350k to 750k. Financing got us into this mess and financing will have to get us out of it. Just wait until October when you hear on the news how bad Sept. was.
you know I really don't feel to bad about the guy that bought the 500k+++ home and can no longer aford it.

SmokinLowriderSS
09-01-2007, 03:02 PM
http://www.msnbc.msn.com/id/20524454/
What on earth is going one here? Is it the governments job to bail out people who were stupid enough to buy houses under terms they can no longer meet? I think this is pure BS. Anybody else with me?
I'm with ya.
If the govt would stay the heck out of it, it'd fix itself, and it wouldn't happen again, because lenders would be more careful, and maybe people would think 3 times before "fudging" figures on a loan ap.

Nubbs
09-01-2007, 03:31 PM
you know I really don't feel to bad about the guy that bought the 500k+++ home and can no longer aford it.
Me either.

speedneeder
09-01-2007, 03:35 PM
Whats the threshold in purchase price where you may have some sympathy?
:rolleyes:

YeLLowBoaT
09-01-2007, 03:43 PM
Whats the threshold in purchase price where you may have some sympathy?
:rolleyes:
So he was forced into to buying a home that was several times above the nat'l and state average home price?

speedneeder
09-01-2007, 03:51 PM
I wasnt implying that anyone was forced to live beyond their means
I was actually just being a smart ass. No offense.
While some people may have made poor financial decisions it must be a really crappy feeling to lose your house.

cdog
09-01-2007, 11:49 PM
you know I really don't feel to bad about the guy that bought the 500k+++ home and can no longer aford it.
Neither do I. Actually I plan on selling it to someone for 425k and make some money doing so. I'm all for people taking their medicine. But if this isn’t let down gently it'll be "A big shit sandwich and we'll all have to take a bite". U 2 if you’re a property owner. The market will find equilibrium once those who are qualified can obtain a loan for terms that are worth while.

Boa1277
09-02-2007, 09:35 AM
The way I see it is the Govt is stepping in to stabilize a very very troubling credit market. I could care less who loses their homes especially if they lied or overstated their income to try and make a quick buck. The bottom line is this is going to de=stabilize our whole economy people need to be able to borrow money and the way it is going now that will not be a option if someone doesnt step in and stabilize the system. Our whole system relies on the ability to borrow money the subprime mess has carried over into other parts of the economy that relies on the ability to borrow on credit to function. Hey that just my opinion, if you think the housing market is bad now, could you imagine the fallout if the stock market takes a big shit.