Mortage Relief

melsb · **Mortage Relief**

This is a article by David Bach discussing the President Bush's recent proposal for mortage relief.

http://finance.yahoo.com/expert/arti...lionaire/44325

It actually sounds like a decent idea ... though I haven't heard anything else on this issue and I'm the first to admit I'm not the most educated about this sort of thing.

Will it work?

aliadam · 09-12-2007, 08:51 PM

I tried reading the article, but it took too much concentration for this time of night!

Is it only for adjustable rate mortgage holders??

Happymom · 09-12-2007, 08:58 PM

Yes, it is only for those with adjustable rates.

debellafunk · 09-12-2007, 10:57 PM

wooohoo good thing we got a fixed rate. After we bought our house at a fixed rate my FIL re mortaged his house beacue his vairable was higher than our fixed that we got ...
Good thing he did that when he did.

Spoodler · 09-13-2007, 08:44 AM

I am really on the fence on this one.

It is not the governments job to bail out people and mortgage lenders who got greedy, didn't educate themselves, and are now having to pay for their bad choices.

On the other hand...

If this mess could cripple our economy as a whole, then I don't see much other choice.

elliesmom · 09-13-2007, 09:22 AM

Spoodler

Quote:

I am really on the fence on this one.

It is not the governments job to bail out people and mortgage lenders who got greedy, didn't educate themselves, and are now having to pay for their bad choices.

On the other hand...

If this mess could cripple our economy as a whole, then I don't see much other choice.

I totally agree with you! I used to work as a sales consultant in the new home market when new home builders and mortgage companies were just giving away mortgages to people they knew could not afford them. I am so glad I got out of that and became a SAHM. Interestingly enough, the company I worked for is under investigation for some wrong doings in the state of North Carolina because they had 75% of a neighborhood go Foreclosure........Why did these builders and mortgage companies take such advantage of uneducated people all to make a buck? It is really sad but it tells me that I am glad I was educated enough to know not to do an adjustable rate mortgage. It is too bad that our government has to bail these people out now, but they really don't have a choice.

Oregano · 09-13-2007, 09:28 AM

Quote:

Originally Posted by Spoodler

I am really on the fence on this one.

It is not the governments job to bail out people and mortgage lenders who got greedy, didn't educate themselves, and are now having to pay for their bad choices.

On the other hand...

If this mess could cripple our economy as a whole, then I don't see much other choice.

ITA!

Kim · 09-13-2007, 10:09 AM

Quote:

Originally Posted by Spoodler

I am really on the fence on this one.

It is not the governments job to bail out people and mortgage lenders who got greedy, didn't educate themselves, and are now having to pay for their bad choices.

On the other hand...

If this mess could cripple our economy as a whole, then I don't see much other choice.

I agree. This is a tough one. With a bailout, will irresponsible lenders/homebuyers really learn their lesson? I guess no matter what happens, responsible people will be paying a price for this too.

Denvergirlie · 09-13-2007, 10:30 AM

Quote:

Bush's proposal strikes a balance by offering:

• Temporary tax relief to ensure that cancelled mortgage debt on a refinanced mortgage isn't counted as income

• A foreclosure-avoidance initiative through homeowner education and outreach

• Ways to help responsible homeowners refinance through FHA loans offering a lower interest rate and lower monthly payments

Quote:

Immediate introduction of a refinancing product called FHASecure. This product will now be offered through the FHA and offers help to homeowners who are already in default of their primary residence mortgage loans. Previously, the FHA would not insure refinanced loans from borrowers delinquent or in default, so this is a significant change.

There are specific criteria that must be met in order to qualify:

1. First and foremost, you must have a history of on-time mortgage payments before your teaser rate expired -- which means you must have a decent credit history.

2. Your interest rate must have reset after June 2005 but before December 2009.

3. You must have at least 3 percent cash or equity in your home.

4. You must have a sustained history of employment.

5. You must have sufficient income to make your mortgage payments.

So there is the guts and glory of the program. Biggest relief is that the gov't will "secure" the loans but there are qualitfications. It's not going to "save" everyone, just those that are going to be bit by ARM's. If people are having a hard time making the mortage now before a ARM kicks in they will not find relief with this plan.

As for myself - a bit torn. I don't want to see the economy on the whole take a hit for bad lending, but also hate it when people are not held responsible for their actions.

melsb · 09-13-2007, 11:14 AM

I really don't have a problem with this. Yes I agree that people should not have applied for these loans to begin with - hey even I knew that AMR's were bad ideas! But I also hate to see people lose their homes not to mention what this is doing to the economy as a whole. And it doesn't appear that they are helping everyone out. They're looking at people with decent credit. And they're also looking at people who can actually afford their loan already and had the house for a period of time (or at least a bit invested in it).

Hmm, I actually am OK with one of Bush's ideas?