Nearly One Year Later, Obama Plan To Help 1.5 Million Struggling Homeowners Yet To Launch

[midnight]

Source: Huffington Post Updated: 01- 9-10 02:13 AM

An Obama administration plan announced in April to help up to half of all struggling homeowners avoid foreclosure has yet to officially launch, the Treasury Department acknowledged Friday.

In an e-mail to the Huffington Post, a Treasury Department spokeswoman confirmed that the eight-month-old program has yet to get off the ground as not a single mortgage servicer has signed a contract with the federal government for this particular effort.

"We don't have any official contracts signed yet, but servicers are committing to the program," Meg Reilly wrote. "We have made enormous progress and continue to move forward with innovative technological development and program implementation and expect to finalize servicer contracts soon."

But the country's biggest bank may be poised to finally sign onto the program. A Treasury official told the Huffington Post that Bank of America's new CEO, Brian Moynihan, re-committed to Treasury Secretary Timothy Geithner this week the bank's intent to join the administration's second lien effort.

But for now, eight months after the plan's announcement, up to 1.5 million struggling homeowners are waiting for a program that's, thus far, stuck in the mud.

Read more: http://www.huffingtonpost.com/2010/01/08/nearly-one-year-later-oba_n_416884.html

---

For those wondering why it is taking so long for help to reach the working class, it is because the big banks don't want to move the money they were given by us..... That no strings attached arrangement gives these banks no incentive to infuse the money where it was intended to go...

[Name removed]

1. Deleted message

Message removed by moderator. Click here to review the message board rules.

[pattmarty]

Dupe.

[pattmarty]

Dupe. Damn computer.

[pattmarty]

This should have been one of the FIRST things put in place................

..........Some might argue that it was his preoccupation with healthcare that caused this, but I will argue "what preoccupation" as he just laid in the weeds and let Congress and the teabaggers define healthcare. You can claim a "first year victory" only when comparing him to his awful predecessor. He is a weak President and will as the RW has said already be compared to a Jimmy Carter. I'll say one thing, this is NOT the change I voted for AND I will not be fooled again.

[bfarq]

48. First things first. It is important that the banksters get their billions first

After all, without Wall Street scam artists, there would be no Wall Street. And a country without Wall Street and the crooks that operate there would be ...

What exactly does Wall Street do that is of any use to our country?

Isn't it time we replace them with computer systems?

[pattmarty]

51. C'mon, you just can't replace all those gazillionaires with computers........

..........for chrissake, that would be like replacing all the healthcare insurance execs and companies with Medicare for all. What kind of an American are you anyway, a liberal?:sarcasm:

[bfarq]

53. Sorry. I don't know what came over me.

[pattmarty]

Dupe.

[pattmarty]

2. Dupe.

[pattmarty]

3. Dupe.

[skyounkin]

85. Damn....

insult the computers and they make you pay!

[pattmarty]

91. It's true.

[MannyGoldstein]

4. Obama Found Out the Thing Helps the Working Class

So it's been effectively abandoned.

Whew! That was a close one.

[SammyWinstonJack]

13. +1

:evilgrin:

[No Elephants]

5. April 28 to January 8 is a year now? Is Huffpo understudying AP's tactics?

Heck, even the body of the article calls it an eight month old program at least twice.

A Democratic Congress had no trouble enacting the TARP within a week or so of Buscho's frantic demand. And, it enacted Obama's stimulus bill in fairly short order, too, quickly larding it with pork first.

If they wanted to do something about this, including they negative equity issue--which they knew about--they could have and stil can. I am including supposedly uber liberal Barney Frank (who claims campaign contributions have absolutely no effect on him or on any members of his committee. :rofl:)

Bill Moyers Journal this weekend ran another show on how the banks/Wall Street has taken over the nation, this time with two writers from Mother Jones, Kevin Drum and David Corn. It was very powerful.

Try to catch it if you can, or read the transcript or watch the podcast.

http://www.pbs.org/moyers/journal/01082010/profile.html#tools

http://www.pbs.org/moyers/journal/01082010/transcript3.html


Moyers PBS website also links to a number of (supposedly) non-partisan citizen groups, grouped under Resources for Reform.

[midnight]

6. This problem was a known fact before Obama got into office-hence a years time.

[Myrina]

7. "NEARLY" a year ...

... the whole title is accurate.

[robcon]

8. It says almost a year and it hasn't LAUNCHED!!!!

Don't you think it's reasonable to get something LAUNCHED in 8 months???? Not expecting miracles, or even lots of results by now. But it should have been LAUNCHED by now.

[shopgreen]

15. Thanks for the Bill Moyers links to the banks show....

very much appreciated as i was going to catch it last evening but did not.

[shopgreen]

9. stuck in pig poop is more the case...

............But for now, eight months after the plan's announcement, up to 1.5 million struggling homeowners are waiting for a program that's, thus far, stuck in the mud.................

[spiritual_gunfighter]

10. Why is the Huffington Post trying to destroy Obama?

:sarcasm:

[Joanne98]

11. Geitner

[midnight]

12. Ding Ding... Why don't they remove this roadblock????

[Blue_Tires]

87. +1

[WriteDown]

14. Please explain how that works...

How would mortgage servicer be "moving the money?"

[billymayshere]

16. Maybe just maybe

There is some change in the treasury left over from the looting for homeowners. Yes, thats the change he was referring to.

[BobRossi]

17. "Change" is slow.

Sometimes it never comes.

[flyarm]

83. and sometimes non existant... as in this case!! or there is some kind of chess game going on..

that we were not asked to participate in..except to pay the winnings out of our pockets.

[PSPS]

18. Actually, this is one plan I'm happy to see never get off the ground

The target of this plan was "second mortgages" which includes HELOC's. People were buying houses they couldn't afford in the first place using NINJA loans, then using the house as an ATM machine to finance everything from luxury cars (they couldn't afford) to world cruises (they couldn't afford.) When it became impossible to borrow money based on made-up income figures, these charletans found that they couldn't qualify for any more refinancing.

These houses need to be foreclosed before the housing market can return to any semblance of normalcy. Using taxpayer money to gift people their ill-gotten houses is the wrong way to go.

[laughingliberal]

21. Wouldn't be complete without the bashing of our new 'welfare queens'

Ah, yes, people who bought more house than they can afford. Driving their cadillacs to the doctor to use up our health care resources with their gold plated health care plans their generous employers are 'giving' them. Then they return to their McMansions that they should have known better than to have bought.

And these deadbeats actually want the banks to use their taxpayer money that was handed to them to help homeowners when their CEO's are having to make do with last year's Gulfstream.

[WriteDown]

23. Just watch any episode of "Flip This House" for numerous examples. nt

[laughingliberal]

26. I'm sure in Ronnie's day there were, actually, a few legitimate welfare cheats.

So, let's just destroy welfare cause a couple of undeserving people might get help. Only hope for that is just make sure no one gets any. Well, except the banksters, of course.

[WriteDown]

28. Different animal?

A person with a HELOC using their house as an ATM and a welfare cheat are really far apart on the spectrum. Interestingly enough, you need A rated credit to get a HELOC in the first place due to the severe risk.

[laughingliberal]

32. The first thing is I find no evidence that the program was weighted towards HELOC's

I have only one mortgage on my home, conventional 30 year fixed rate obtained with verified income, a down payment, a FICO score of 811 when we bought in 2005. Our finances changed when the housing market crashed and my husband's business (in operation since 1982) crashed with it. My point here is every time I call to make our late mortagage payment now they ask about applying for one of the mortgage relief programs. So, I don't think your premise that this program was targeted to HELOC's and people 'who used their houses as ATM cards' is accurate.

And the demonization of homeowners who are struggling now is exactly the propaganda sold to the American people about the 'welfare queens.' Every attempt to turn average working Americans against other average working Americans is another attempt to keep the masses fighting among themselves and not hold the people who have been skating on their obligations to society for decades and passing laws to allow them to legally rob the people and our treasury.

[WriteDown]

35. The program we are talking about hasn't even gone into effect yet...

The programs you are referring to are being done by the servicers themselves. Like I said, different.

[timefortherevolution]

69. Very well said. I'm supposed to feel ashamed if I walk away from a house

worth 12% of what I paid for it and the banks are rewarding themselves with billions in bonuses.

Your idea that they're turning us against one another is spot on.

It's the only way the banksters can divert our attention away from their criminality
while American Idol is on hiatus.

[midnight]

86. There are so many reasons for the struggle to pay the mortgage like you

clearly state in your post. It is very worrisome that those who are without this struggle choose to view it through the lens of the predatory system that is destroying families.

[lame54]

30. you need to turn off the tv.

and talk to the majority of people losing their homes.
Medical or loss of a job is more the norm than Flipping a house.

[WriteDown]

31. If you've lost your job...

How is a loan program going to help you? :shrug:

[laughingliberal]

54. Perhaps there is a second person in the family working.

Perhaps the income is reduced and a reduced mortgage payment would save their house. Is 'Flip This House' the only information you have on what happened here?

[WriteDown]

56. How much should the payment be reduced?

And how should that be calculated?

If there is a 2nd person working and your income is half of what is was, then should your payment automatically be cut in half?

Also, my previous question stands, what if no one has a job? How is a loan modification problem going to help?

[laughingliberal]

59. The money should have been used to pay down principle for homeowners

Roosevelt solved the problem is his day by bailing out the homeowners and having them pay the government back. People kept their homes and the government made a profit on it. The current line of thinking is just more indication of the mean spirited society in which we live meant to keep working class Americans fighting each other so we never take back the trillions that were stolen from us over the last 30 years. Good job. The welfare queen myth moves another notch up the socio-economic scale every few years. One day everyone not of the top 1% will get to be a welfare queen. Those who fight against their own class now will have no one to whine to when their turn comes. And it will if they live long enough.

Obviously not everyone is in the same circumstances. But your statement belied the fact that there are a lot of these families who have not lost all their income but some of it. I think the people who are wanting to see millions more homes on the market may be the vultures waiting to snap up the devalued properties. I see no way they think that will benefit the economy as a whole.

[WriteDown]

60. Not sure where you are getting this from..

I made no such statements. You and I completely agree on what SHOULD have been done. It is a far cry from what is being done though.

[laughingliberal]

64. Misunderstood. Sorry. nt

[Riley18]

63. How impressive that WriteDown is still spewing the same stupid shit. Glad

you still have a closed mind to anything that would be helpful to regular Americans. Logic is lost on you. The only thing you can do is cite FOX talking points. It's like Ronnie rose from the dead.

The simple and logical answer to your "question" is that the bank is supposed to make the mortgage payment 31% of gross income. This program was paid for by taxpayers so that families that have suffered a loss of some of their income would be able to stay in their homes.

The question is not whether or not the family "deserves" to remain in their home, but rather why won't the banks comply with the program? The banksters lined up for our tax money and now they have hidden it away for themselves. They need to be made to comply with HAMP.

[WriteDown]

66. So....

Regardless of credit rating, the payment should always be 31% of gross income? Interesting. What if they still can't pay at 31% of their gross income? What if the investor will not allow the servicer to drop the rate to 31% of gross income due to the pass-thru rate?

Big difference between banks and mortgage servicers by the way.

[haele]

75. I actually watched "flip this house", mostly for the DYI and contracting info,

And what I saw were Real Estate agents and contractors purchasing houses to resell as a business, not Joe and Jane IT Engineer trying to upgrade their house to sell for a McMansion.
Joe and Jane IT Engineer, who are the actual homeowners in trouble got there trying to upgrade the house they were living in to keep up with the Joneses. Or they got line of Equity loans to pay for college for the kids, or medical issues when health insurance was not enough to pay the bills.
Or there was a re-location for work, and the quick-sale of their previous house didn't make enough for the same sized home in the new state.

Or they were first-time home-buyers who didn't know how to read a real estate contract, and didn't understand how mortgage payments compounded and how the ratio of Principle and Interest was paid out. Also, first time buyers don't get the low rates that are advertised because they usually don't have enough credit on large, multi-year purchases to show that they could stay in a house for 15 - 30 years...and the mortgage companys cynically realize that families don't usually stay in the same house for 30 years; even if they stay together, once the kids are out of the house, Mom and Dad tend to want to downsize and sell the house just as the mortgage starts getting paid off. The first home is viewed as the buyer's "investment" now instead of a family home.

I bought a house 15 years ago that I thought "no problem, I could easily afford" - even did pre-payments when I could and got rent-mates to help during times the few weeks there was no work, as I was on contract, like 3/4 of the workforce still is.
Even after reading the contract on a 30 year fixed loan at "first time buyer's rates (8%), that first bump up once the initial five to seven years goes buy and they start adding more principle to the payments is a bit of a shock. And work started getting more sporatic, so I had to short-sell because threats to forclose started coming in as I started getting behind and just couldn't catch up. It's hard for even smart people to realize that even with the minimium down-payment, at the end, you're paying the bank or the mortgage holder over twice the value of your purchase by the time it's paid off. And that ended up just not being worth it.

Haele

[CRH]

36. Read his post, this person has it right, ...

second mortgages are used when the house doesn't appraise high enough for the desired loan quantity. With no down payments, make up your income and write it down loans, nearly all of these people were buying at over inflated house prices. These loans have been under water from the day they were written, and are still sinking deeper. Without some sort of a new loan that forgives a part of the principle, the overwhelming majority of these home owners will be negative equity for years to come. It was bad judgement when the loans were signed, and without serious adjustment of the principle in these loans it is just as bad judgement for politicians to rescue these loans when a huge majority will fail, again.

The real estate market does not yet support a home owner bailout, with prices in many markets still declining, and more foreclosure and forced sale inventory ready and waiting to enter the market when downward price pressure is less. With this sad reality, it is better this program is delayed until a time it has a chance for success, or perhaps scraped altogether.

[salib]

40. Just keep on blaming the victim

The loan sharks can be bailed out and the home owner gets shafted.

Yeah, that's the ticket.

[CRH]

43. I'm not blaming a victim, ...

if a person bought a home that was either over priced and could not appraise to desired loan value, then needed a second to accomplish financing.

When a person signs a loan for more than institutions will lend, even when standards are non existent, it is hard for me to believe this person a victim.
The need for a second mortgage is a primary indication the house was under water from the time it was bought, or the original mortgage would have covered the full price.

There is a point when responsibility for individual decisions must challenge the concept of victim.

[laughingliberal]

55. My house appraised higher than what I paid for it.

We built, were in escrow 7 months and didn't need a 2nd to finance it. In fact we made the standard 20% down payment, took our bank statements and check stubs to the lender every single month we were in escrow. House appraised when we closed for $50,000 more than the amount we financed plus our down payment. You're buying the propaganda that is meant to keep the heat off those who perpetrated the fraud on the American people. Just as insidious and dishonest as Ronnie's welfare queens.

Oh, ain't America great? Welfare for the uber rich who stole the wealth of the nation and personal responsibility for those they stole from.

[WriteDown]

62. And the market tanked....

I'm in the same boat. I just have to delay moving for 5-10 years (hopefully!).

[laughingliberal]

65. Will work out for those whose circumstances have not changed

We, on the other hand, have been taken down with the economy. Can't sell the house for enough to get out from under the mortgage. I have been in favor of walking away for a while, now but we did sink everything we had into it in hopes of retiring with a fixed housing cost to go with our fixed incomes. My husband is very emotionally attached to trying to keep the house. So, we keep scraping up just enough to keep from going 90 days past due and hoping his business picks up or I recover enough to work again before we fall off the cliff.

[WriteDown]

67. That is terrible...

You posted what SHOULD have been done upthread, but the current "solutions" are a joke.

[laughingliberal]

72. It has been terrible and, likely, to get worse for us

I'm resigned to living out the rest of the time we have left in poverty and, perhaps, homeless before it's over. But I would sincerely like to see some shift in policy to let me know we might return to a country where a working stiff had a chance and people weren't one busted bubble away from permanent ruinations.

The current solutions are a joke. We gave billions to the finance companies for pretending to work with homeowners. They wind up with the billions and people's houses.

[midnight]

95. Of course it is hard for you to believe, because your understanding of the second loan

was because it was a tool used to finance a bad mortgage in the first place. The products that consumers purchase are considered under the regulation of the banks and therefore a good solution, and not bad. That is why this is NOW be considered predatory lending. And this is why the responsibility should come from the banks......

[laughingliberal]

52. Yep.People who bought houses-the new welfare queens

I know what a 2nd mortgage is and I know a lot of people in danger of losing their home who don't have a 2nd mortgage. And I know my finance company keeps trying to get me to apply for the damned program and I don't have a 2nd mortgage. I haven't because our income is next to nothing, now and I know we don't qualify and they would fill out the paperwork and collect their gubmint check for pretending to participate.

Yep. Everyone losing their house today bought without a downpayment, used a 2nd, lied about their income, had crappy credit, should have know better.

Sorry, I'm just not buying it. I bought in 2005 on conventional loan 30 year fixed 6.15% interested, 20% down, FICO score of 811, in escrow (we built) 7 months and carried proof of my income to my lender every month. Real estate 'experts' including friends of mine in the business who would not have lied to us fully expected the market here to keep going up and, possibly, to slow a little 5 years out but, certainly, not to crash. Getting older, my husband and I decided it would be smarter to buy than keep renting. One because rents here were getting as high as mortgages and, two, because we didn't want to face retirement some years out with our housing costs going up once our income was fixed.

Bad judgement to help the homeowners but great judgement to rescue the banks who have not changed their behavior. This program was not aimed at 2nd mortgages more than it was at first mortgages. Roosevelt saved the homeowners and the banks with his program. We just live in a society today that worships the rich and famous and won't spend a dime on someone who might have had to the bad luck to buy at the wrong time or lose their job after they bought.

[jeff47]

78. You don't know much about real estate

second mortgages are used when the house doesn't appraise high enough for the desired loan quantity.

No, second mortgages are used for a variety of reasons. Just one example is to avoid private mortgage insurance that is typically required in a 90/10 loan. Make it an 80/10/10 and PMI goes away. Then there's the people taking out seconds long after purchase for whatever reason (college, unexpected repairs, remodels, medical bills, etc).

The real estate market does not yet support a home owner bailout, with prices in many markets still declining, and more foreclosure and forced sale inventory ready and waiting to enter the market when downward price pressure is less.

Prices are continuing downward because there has been no effort to reduce principle (aka home owner bailout). If we wait until the bottom completely drops out, then:

1) >50% of homes will be underwater on their mortgage, due to all the foreclosed houses.

2) there won't be a need for a home owner bailout, because only a few morons would still be in their underwater houses. Even if you can afford the payments, it's stupid to take a $200k loss on a $400k investment when you can lose $0. It's gonna take you much, much longer to recoup that loss than the foreclosure will stay on your credit report. Dump it and move on, just like the banks do.

There's been an enormous loss of wealth due to the bubble's implosion. The question becomes who's gonna eat the loss. So far, it's a relatively small set of homeowners paying, but they're dragging everyone else down with them. It's better to start modifying principles in such a way that the homeowner, bank and taxpayers take a hit, so that we all don't take a far, far, far, far worse hit.

[gmpierce]

84. close...

You sort of got it right. Before the bubble started smart lenders required mortgage insurance when the loan-to-value was over 80%. The insurance was required until the borrower had 20 % equity.

Insurance companies were not dumb so they actually charged a reasonable premium, and the total payment was then more than the borrower could afford.

With housing values inflating at over 20% a year, the lenders decided to use second mortgages to make unworkable loans work, and to keep the profit that would have gone to the insurance company. Unfortunately, the insurance companies were a lot smarter than the lenders.

[Dappleganger]

76. What's the number reason for a HELOC??

Medical bills!

[Stumbler]

19. Pathetic

Obviously, if it helps the middle & working class then it must be delayed... at all costs.

[Lydia Leftcoast]

20. Instead of a bank bailout (in essence, rewarding cowboy financing), the Obama

administration should have told the banks "No deal, we're providing low-interest, stretched-out loans to people who are in danger of foreclosure, and we're going all regulatory on your asses. Also, no bonuses for anyone until the banks have been profitable for five years in a row. If you agree to that, we might let you live. Otherwise, we'll break you up so that you're NOT too big to fail."

[laughingliberal]

22. but...but...but...the CEO's are living with only 7 homes and 1 yacht

How can you be so cruel?

[midnight]

34. Lydia that is great advice...

[zeemike]

24. the Banks don't want more loans

They want the property....and so they drag their feet while the eat.

[thecrow]

37. That would be the cause of the "housing market" being up 7.8% last month

IMHO:
The bankers are selling off the houses that homeowners have lost due to unemplyment or bad health.
The homeowners may have been paying for years and then the problems hit and they couldn't pay.
Now the banks are making profits out of the homeowners' losses. Around here, you see MANY "bank owned" properties selling for the SAME SELLING PRICE of "not bank owned" properties. So the banks are making out like the bandits that they are and the homeowners are lucky to move into somebody's basement.

[liberation]

46. Depressions are when assets return to their rightful owners: the super rich

The boom/bust cycles in capitalism are engineered to do exactly that: expand assets during the boom, and recover said assets during the bust.

What I am fascinated is by the fact that most people not only put up with, but they seem to love this rip off. Morons... LOL

[zeemike]

50. they did the same thing to the farmers back in the 70s

Convinced them that the needed to get big or get out of farming and then loaned them a bunch of money that they could not pay back because the commodities prices went down.
Then they took it all back and sold off the equipment and then the land at inflated prices....made out like bandits.

[Vidar]

25. Another "triumph" for old "Yet To Launch" Obama.

[defendandprotect]

27. Have any of us heard ONE WORD from Obama and Dems about homeless . . .

or impoverished Americans?

Nixon -- the criminal -- felt more compelled to address poverty than

Dems do now!!

Times have certainly changed . . . but not for the better--!!!

These days, according to the media, anybody to the left of Hitler is way out there in left land.

[harun]

38. 1st rule of American fascism, never talk about poverty or the homeless. It makes

the well to do's feel guilty and not vote for you.

Dem's won't be bringing this up any time soon.

[salguine]

29. Homeowners should just write in "banker" on the application. They'll have the money in 48 hours.

[defendandprotect]

33. Using taxpayer $$ to bail out capitalism is so much more important to Obama and Dems . . .!!

Wake up, folks . . . we have elected a president who is piling on the

corporate/fascism --

[timefortherevolution]

73. Some of us knew this before he got elected! We got a cyber-mugging anytime

we questioned his abilities to right the ship in this economic disaster.

I don't care how everyone wants to bash the Clintons....they served the middle class better than
a lot of presidents have.

Yes, they made some mistakes. But Hillary has a lot more cojones than Obama.

Always had.

[defendandprotect]

90. Agree . . . I certainly wasn't expecting much . . .

but certainly not this level of betrayal ---

But the real shocks came when he began to put his team together!!!

Beginning with the poisonous Rahm Emmanuel/DLC --


It was hard to dislike Clinton despite his dismantling of 60 years of welfare

safety net -- which by the way, Gore encouraged him to do!

And other communications deals, etal -- trade agreements -- much of that set us

up for being further taken over by corporations.

Granted while Clinton was creating jobs/opportunities -- not on a level it should

have been -- he was cutting safety nets.

Also leaving behind the huge surplus is unbelievable!! Thrown away by Bush --

It could have been attributed to debt reduction or turned back to Social Security . . .

whatever -- in the end nothing positive happened with it!

Hillary was always a problem for me because she is DLC - - she's not only DLC ... she's

part of DLC leadership!!!

No way --

[Zhade]

99. Unfortunately, she lies just as obama does. His was the PO, hers was Tuzla.

On reflection, her lie -- while repugnant -- at least didn't totally fuck over the people who put her in office.

But a lie is still a lie.

[salib]

39. I guess this is what they mean by "shovel ready"

Ready to shovel some more crap, er... excuses, er... explanations as to why nothing is happening for US, as opposed to THEM.

http://www.democraticunderground.com/discuss/duboard.php?az=view_all&address=389x7395760

[laughingliberal]

57. lol. Shovel ready-the working class, just about ready to have the dirt shoveled over them nt

[Frank Booth]

41. Hopefully, it will never launch.

The housing market is still grossly overinflated in many parts of the country. The government actions taken so far -- such as the $8000 credit -- have done nothing more than prop up a bloated and failed system.

The foreclosures need to work their way through the system so we can once again have a reasonably priced and sustainable housing system. I realize this is a sad thing for people who unfortunately bought at the top of the market or had to take out a second mortgage because of medical issues (I have no sympathy for those who refinanced to buy luxury cars or put in new pools, which was a common occurrence). But renting is really not so bad, and is still a better deal than owning a house in many places.

[laughingliberal]

58. Yep, let's get those welfare queens out of our houses

A 7 month inventory on the market now and millions more home to come. That'll help. Meanwhile the banksters have pocketed the $75 billion that was given to them to help save some homes.

Good plan!

[Frank Booth]

77. As you know, two wrongs don't make a right.

If the US is going to survive as a somewhat functioning society, we're going to have to become a lot more responsible.

I agree that thousands of people working on Wall Street should be sitting in jail right now. But encouraging the perpetuation of an irresponsible and unrealistic housing market isn't going to help matters.

[haele]

80. Are you using statistics or your local anecdotal experience about foreclosures -

Anecdotal, true, but most first home foreclosures I am aware of are due to (in these orders):
1. Job loss or downsize
2. Small business owner who used his or her home equity to start or prop up the business during lean times
3. Medical or emergency Bills
4. Divorce - the spouse that got the house really couldn't afford to keep it on his or her own, and didn't sell to downsize
5. Failure to understand the initial contract or being conned by a mortgage provider to take out a second to "pay for the down-payment on the first" instead of being told to look for something smaller. Numbers can be framed in such a way to lie when you're discussing percentages and amortization costs, and even people familiar with real estate can be convinced that things would never get worse than they are now, so it's a "slam dunk" to buy at this low, low rate when you are in the position to pay it.
6. Owner relocated and could not short-sell.

The amount of 2nds or "home equity" foreclosures usually had to do with:
1. Job loss or downsize
2. Small business owner who used his or her home equity to start or prop up the business during lean times
3. Medical or emergency Bills
4. College costs, student loan payment issues
5. Tax issues - primarily due to the re-assessments.

On edit, I've checked with my brother in law, a loan officer at a small local bank, and in his assessment, my list is pretty accurate -

The luxury cars, the pool, the "use the house as an ATM" is relatively small contribution to any foreclosure, because most people going into foreclosure are under water for far more than the luxury items they bought.

When I short-sold my house $130K house for $150K seven years after I bought it before it would get foreclosed on in 2002 (it did not have a 2nd on it) it was due to a mixture of causes 1, 3, and 5 in the first group. Job slowdown, increased medical bills, and the way the contract was set up to "ramp up" the principle payments after the bank got enough of their cut of the interest to make it profitable for them if I started running into trouble.
And that amount of money just got me around $5K in the bank after all the taxes and fees were paid and the dust settled. Enough to move to a cheap apartment on.

What I sort of regret, if I would have been able to hold onto it for another 6 months, I could have gotten half again that amount - probably around $220K - but it would have been sold to an investor or a house-flipper who would have dropped around $20K at most into it to "upgrade it" to sell in another two months at $350K. That's how fast the housing prices were rising.
As it is, the person who bought it from me still owns it, isn't in trouble because they didn't do anything fancy with it other than make the necessary repairs, and can still make the mortgage - as someone else who might have bought 6 or 7 months later at a higher price might not have been able to do. So I guess there was one good thing about that whole mess.

And that's why, in my opinion, so many people are in trouble.

Haele

[debbierlus]

42. Trillions to the banks & Wall Street & HUGE bonuses to the very people

Who brought the system to its knees....

And, Bernacke & Geithner appointed by Obama to top positions in his administration.

DISGUSTING.

[Imagevision]

44. Exactly! zillions to Wall St. and zero for small business loans. 100 million less loaned out

Ariana Huffington came out with a slick idea -> pull your money out of the big banks and put it in smaller ones -> "move it around: this is sending a message, gosh I hope Huffington's plane doesn't crash in an "accident" (?)

[Blackhatjack]

45. If We Wait Around For Banks To Do The Right Thing, that will be....NEVER

When the Big Banks got the taxpayer money without strings attached for almost no interest they naturally would put that money on their own balance sheets to cover the major blunders that stuck out like sore thumbs, and had no intention of lending that money to taxpayers --certainly not at anything close to a reasonable interest rate.

It is sickening to hear them explain to customers who never missed a payment that raising their interest rates to 27% or higher is 'just a business decision.'

Banks have no morality --they act coldly in their best interest.

If the shoe were on the other foot, the Banks would never make another payment and walk away. Hey, that sounds strangely close to what the BAnks are doing when they fail to make their dividend payments due to the Government. Hmmmm.... can we send them a nice little statement that includes late charges, over the limit charges, and threaten them with foreclosure?

Oh, I forgot... they are treated differently.

[scentopine]

47. Your corporate government - hard at work -nt

[Name removed]

49. Deleted message

Message removed by moderator. Click here to review the message board rules.

[fascisthunter]

61. may those who blame the victim by assuming they are at fault

may you all live through poverty and then have to hear someone blame you for the situation you find yourselves in. You have no idea how this shit happens, but man are you folks quick to judge them.

[laughingliberal]

68. I believe a large number of average Americans will live to see the day when one way or the other

they will become the new 'welfare queens' of society. I have watched the villainization of one group after another moving a notch up the socio-economic ladder every few years. Anyone not in the top 1% will have their chance to be demonized. Then, I suppose the top 1% will have to fight among themselves.

[fascisthunter]

96. Reminds me of a cartoon in which a vacuum sucks itself up into an oblivion

[Sultana]

70. BULLSHITE!!!

[Bluebear]

74. Bailouts for AIG, Goldman...crap for ordinary citizens courtesy of a Dem President & Congress

Disgraceful.

[laylah]

71. I'm still waiting...nt

[CoffeeCat]

79. Since when do we leave it to the big banks...

...to decide whether or not they want to participate in programs that the
President implements???

Seriously. What the hell.

This program is contingent upon large, greedy, criminal banks signing on? We're relying
on the good graces of these corporations...the ones that just stole all of our money and
bought off our politicians, so they could become "too big to fail" and operate under
practically no regulations?

Really? Seriously?

This is damn dumb!

What's next...employment subsidies that rely on the approval of Charles Manson?

:eyes:

[midnight]

88. That is the huge question mark from me too. Why are these banks who were

given our tax dollars no questions asked not working to extend this help to others?

[Fearless]

81. Wall St. instead of Main St... I'm getting sick and tired of this.

[flyarm]

82. slap me silly and call me surprised..NOT!..eom

[stuart68]

89. one more almost done promise

"We don't have any official contracts signed yet, but servicers are committing to the program," Meg Reilly wrote.

is that like almost being pregnant ? One more missed committment - let's here it for Hope and Change.

[donheld]

92. We got punked!

[valerief]

93. Sausage-making. Chess. So say Sausagina and Chessy Morgan.

:grr:

[David Zephyr]

94. K&R. President Obama's priorities were Wall Street, Banks, Defense Contractors & Insurance Giants

Creating new jobs and helping stop the foreclosing on American homes, well that had to wait until 2010.

[and-justice-for-all]

97. Well how the hell is that Obama's fault?!!

"not a single mortgage servicer has signed a contract with the federal government for this particular effort." Duh!!

Why wait on the private sector? Just use FHA and HUD to get it going.

[midnight]

98. The title states that this is an "An Obama administration plan"

announced in April to help up to half of all struggling homeowners avoid foreclosure has yet to officially launch.