Obama's shiny new housing plan

[babylonsister]

Obama's shiny new housing plan
Andrew Leonard


Comprehensive, clear and ambitious, President Obama's new housing plan is unlike anything we have seen from the White House since the financial crisis began. Loaded with incentives for homeowners, mortgage servicers, lenders and banks, the plan also includes a substantial direct commitment for government help, and a direct message to the banking industry: If you want any more cash from the U.S. government, you are going to have play by our new rules.

From a summary of the plan distributed by the White House, a few hours before Obama was scheduled to outline it in Arizona:

All financial institutions receiving Financial Stability Plan financial assistance going forward will be required to implement loan modification plans consistent with Treasury Guidance.

One could quibble: Why not declare that all financial institutions who have already received government aid adhere to the new guidelines (which will be specified in detail on March 4)? But that's a moot point: The banking system is in bad enough shape that further government help is inevitable. But now there is at least one clear string attached to that aid.

The goal of the plan, through a variety of mechanisms, is to lower monthly payments for homeowners who owe more than their homes are worth or are in immediate danger of foreclosure. The White House says that, all told, nearly 9 million homeowners will qualify.

more...

http://www.salon.com/tech/htww/2009/02/18/obamas_shiny_new_housing_plan/

[Thrill]

1. According to the HUD Secretary there is also help for those that the program can't save

Housing and Urban Development Secretary Shaun Donovan used it when discussing plans for borrowers who owe so much money they can’t be helped by the mortgage relief Obama offered today.

“One of the things that we do with our plan is to provide incentives for those families to be able to transition out of homeownership in a way that doesn't hurt them and doesn’t hurt communities around them,” Donovan said.

He said the administration would encourage short sales and measures to preserve the credit of homeowners who are underwater.

[Cha]

2. "We all have to take responsibility"..

Hope this helps out all the people who need it!

[kimmerspixelated]

3. Bsister,

Things are tight here, but I sure wish I could give you a heart!:hi:

[MadHound]

4. Sounds like they're going to reward the people who made stupid decisions

And let their greed outrun their good sense. Meanwhile, those of us who did the right thing, made the right moves, are going to get stuck with a seventy five billion dollar tax bill (and possibly more) in order to bail these idiots out.

Yes, I realize that in many ways this housing crisis is one of those "too big to fail" things, however I'm getting damn sick and tired of having my hard earned money going to bailing out the stupid and greedy. I could stomach these bailouts, for both the folks on Wall St. and the the folks on Main St. if there were some sort of smack upside the head just because they were idiots. Suffering the consequences of your own bad decisions is a much better way of insuring that there's not a repeat performance in the future. Instead, were rewarding these people.

Once again I wonder where is the bailout for those of us who did the right thing? Oh, that's right, we don't get one, we just get to bail out the damn fools and idiots who got us into this mess to begin with. Next up, we get to bail out the idiots who ran up tens of thousands of dollars on their credit cards as they tried to keep up with the Jones.

[peace13]

5. They are not forgiving any of the debt only arranging for the buyer to continue to pay

their mortgages. If that can happen then there will be fewer homes on the market at rock bottom prices and the market will be better for all of us. Especially those who weren't greedy.

[MadHound]

6. Yes, they are

"For example, homeowners who make their payments on their new, modified loans on time for five years will see reductions in the principal owed on their homes -- $1,000 a year for each year that they comply. Similarly, mortgage servicers will receive upfront fees from the government "for each eligible modification meeting guidelines established under this initiative," and further fees if the borrowers stay current on their loans. Additional fees will be paid to both servicers and mortgage lenders, "if they modify at-risk loans before the borrower falls behind."

Fee's waived, principle paid off, hell, from various sources I'm hearing that interest rates will be renegotiated at four percent or lower, fixed. Can you get that sort of rate? No, neither can I.

Again, millions of Americans have done the right thing, when are we going to part of our principle knocked off? When are we going to get those special super low interest rates? Oh, yeah, that's right, we're going to be paying for them with our tax dollars instead.

Hell, five years ago I should have just gone hog wild nuts, bought a McMansion on a hundred acres with a nothing down ARM. Sure, I would have had to go through a few months of hell, a year at most. But hey, I would have come out with one hell of a bargain.

[peace13]

8. A - The chances of someone making all of the payments on time

over the next five years will be very slim. It is a nice dream but it's not gonna happen. It is time to move on. Most of these folks won't ever pay off their loans. Be happy if you made good choices. Fire up and make some money on some of these foreclosures. Life's a possibility.

[MadHound]

11. If they get their mortgage payments renegotiated as this plan proposes

Then I doubt that it will be that difficult to make those payments for five years. Down to thirty one percent of my take home? That's not a hard payment to make.

But I'm certainly not going to get into the real estate market now. Never wanted to, don't need to, I've got plenty of house and land and don't need anymore.

[treestar]

7. We're all in this together

It's a big disaster. If they go down, you could too.

There but for the grace of God go I. It could happen to any of us.

Maybe you really are better than all those people, but must they suffer for it? We don't know their backgrounds situation or that with their lot, you might not have been an "idiot" too.

[MadHound]

9. A pious platitude, that's for certain

But it doesn't negate the fact that both the borrowers and the lenders in this catastrophe were greedy and/or stupid.

There but for the Grace of God go I? I think not. When I purchased my first house fifteen years ago I made certain that I bought something I could afford, a starter house, something I could live in for ten years, improve, sell and move to a better place. Yes, it's dull and boring, consisting of work, sweat and money. But I made a decent amount on the sale, enough that I could afford a better place ten years later. When I got my current place once again I did all the right things. I stayed within my budget, didn't get a McMansion, got a dull thirty year fixed mortgage and paid a hefty down payment. I read through every piece of paper both times, and for things that I didn't understand I got help. This isn't a matter of divine favor or blind luck, this is a matter of using my head for something besides a hat rack.

Then there are the millions like my former neighbor, who went out and bought more house than he could afford, got it on a nothing down, ARM, in addition to racking up his credit cards buying ATV's and such, and now he's facing foreclosure. Yet Obama is proposing that my hard earned tax dollars go to bailing this fool's ass out of the fire? Sorry, but this is just wrong.

Yes, I realize that there are people who did do the right thing, and yet through no fault of their own they are now in dire straits. But there are also millions like my neighbor, stupid, greedy, impatient with poor impulse control who didn't think before getting this loan. Why should they be rewarded by getting money knocked off their loan and a better interest rate than I can get? Sorry, but that's simply not right. I would much rather see selective help for those who wound up in dire straits through no fault of their own, I have no problem helping those people. However for those like my neighbor, I say fuck 'em, let 'em sink. If you were a greedy stupid idiot then you deserve to suffer the consequences. And you certainly shouldn't be able to get a better deal than those of us who did do the right thing.

[FrenchieCat]

10. I'm surprised you have heart(s).....

I truly am!

[MadHound]

12. Hey, I not only have hearts sweetie

But hundreds of real life friends throughout the US and around the world:shrug: I also rescue animals, rescue people, help those in need, give to the homeless (after all at one time I was one), give to my community, do more than my share helping the environment, and have a good time doing so.

You've just got a biased view because you don't like my politics, which are far left of yours, and because I was instilled with that old fashioned notion of personal responsibility. I imagine that if you met me in real life we would get along famously. But you base your opinions of people are some fairly narrow parameters that really have little to do with people in the real world. Oh well, your loss.

By the by, cute kid you got there:hi:

[FrenchieCat]

13. What bothers me about your politics has nothing to do with the personal.....

but rather that you define yourself incorrectly, from what I can tell.

A person on the far left of me wouldn't call homeowners in a bind through no fault of their own as stupid and greedy. So yes, I disagree with a lot of what you have to say, but not for the reason you think. Using your own words, I consider judging on a fairly narrow paramater that really has little to do with people in the real world to be a biased view.

I hope one day President Obama does at least one thing that you will be able to praise. Until then, take care of yourself.

[EraOfResponsibility]

14. ^^^^And that, MadHound, is why Frenchie has way more hearts than you

you go, girl! :)

[MadHound]

18. Ooo, it's a middle school popularity contest

Geez, they were stupid then, they're stupid now:eyes:

God forbid that we hold anybody responsible for their own stupidity and/or greed.

[EraOfResponsibility]

21. yep it is, and you lost

now go into a corner and suffer from low self esteem. :)

[HughMoran]

15. .

:thumbsup:

[MadHound]

16. Again you seem to lack reading comprehension

Show me one place, in this thread or others, where I go off on people who got into a bad bind through no fault of their own. I'll be waiting a long while, I'm sure.

If you care to read for comprehension instead of the quick snark, you would notice that the people that I'm going off about in this thread are those who got greedy and bought a house that was out of their price range, those who got a nothing down ARM or liar's loan, those who wanted instant house gratification and took short cuts rather than treating the buying of a house with the gravity it deserves.

Oh, and you don't have to hope anymore since Obama did get the stimulus passed. Something I approve of, even though I didn't like all of what ended up in it, namely all the tax cuts, and thought that Congressional Dems caved too easily to the 'Pugs, giving away good stimulus money on school construction and the like. But it is better than nothing, and for that I applaud Obama.

His Afghanistan policy however is an entirely different matter:evilgrin: He's walking into another quagmire on that one. Ah well, I've been hitting the streets for peace demonstrations for this long, I think that I can continue for awhile longer. Peace:hi:

[kypp]

17. I agree, and...

...isn't there an incentive now for folks to stop paying their mortgage payments in order to get a bailout? Just asking.

[azmouse]

19. How about personal pride?

And a little something called fraud.
If someone can pay their bills and choses not to in an effort to get bailout money they are not entitled to... well, let's just say a nice, warm jail cell could end up being their new home.

[vaberella]

20. I just read this on BBC....great post!!! n/t