Second stab at the foreclosure fix plan

User Forum Topic
Submitted by DWCAP on April 28, 2009 - 3:46pm

Sigh, F the responsible, reward the loosers, and who cares about the taxpayers, again......

http://money.cnn.com/2009/04/28/news/eco...

During the housing frenzy, many borrowers obtained second mortgages to allow them to put little or nothing down when buying a home. Up to half of at-risk borrowers have second liens, according to the administration.

These loans have complicated the modification process. For one thing, they add to troubled homeowners' debt levels. Also, mortgage investors have balked at reducing payments on first mortgages when the second loan was left intact.

Under the administration's new program, the interest rate on second mortgages will be reduced to 1% on loans where payments cover interest and principal and to 2% for interest-only loans. The government will subsidize the rate reduction, with the money going to the mortgage investor.

Servicers will be paid $500 for each modification and an additional $250 annually for three years if the borrower stays current. Borrowers can receive up to $250 per year for five years to pay down their first mortgage.

Investors can also receive a payment in exchange for extinguishing the second lien. They would receive 3 cents on the dollar for loans more than 180 days delinquent and between 4 cents and 12 cents for less delinquent loans, depending on the borrowers' debt levels.

Servicers who join the new program must modify second loans when a borrower's first mortgage is adjusted. It will likely take a month to implement, but it should not slow down the modifications of primary mortgages, the administration said.

"By bringing both the first lien and second lien program together, we can reduce monthly payments for borrowers and make it much more likely that they can stay in their homes," a senior administration official said.

‹ intentional overextension Home Staging + Cheap Rent ›
Now that's change I haven't
Submitted by flu on April 28, 2009 - 4:05pm.

Now that's change I haven't seen !

I read on calculatedrisk that
Submitted by garysears on April 28, 2009 - 4:15pm.

I read on calculatedrisk that the 2nd mortgages are going for about 2 cents on the dollar on average. Sounds like this is a can't miss bailout of the 2nd mortgage holders.

I've already surpassed the
Submitted by jpinpb on April 28, 2009 - 4:17pm.

I've already surpassed the bailout burnout.

From the article: The
Submitted by Arraya on April 28, 2009 - 4:17pm.

From the article:

The government will subsidize the rate reduction, with the money going to the mortgage investor.

Is this what they mean by trickle down economics?

Well this is pretty much to
Submitted by SD Realtor on April 28, 2009 - 4:42pm.

Well this is pretty much to be expected. The good news is that we will be seeing more of these programs.

At least when our taxes go up next year we will know where some of the money went. Whew!

Not calling a bottom but if
Submitted by Russell on April 28, 2009 - 4:56pm.

Not calling a bottom but if this stuff doesn't guide people's instincts, What does? Hits me in the pit of my stomach.

Under the administration's
Submitted by CA renter on April 28, 2009 - 5:00pm.

Under the administration's new program, the interest rate on second mortgages will be reduced to 1% on loans where payments cover interest and principal and to 2% for interest-only loans. The government will subsidize the rate reduction, with the money going to the mortgage investor.
----------------------

Can't the servicers lower the rates to 1% (or even 0%!) all by themselves? Why does the govt (that's us, the taxpayers...again) have to subsidize anything? These are the lenders' loans, and it's up to them to modify them however they see fit. They can reduce principal or lower rates without any govt assistance.

Can somebody please explain again WHY we (taxpayers) need to do this?

CA renter wrote: Can somebody
Submitted by AN on April 28, 2009 - 5:04pm.

CA renter wrote:

Can somebody please explain again WHY we (taxpayers) need to do this?

Because the man said so.

CA renter wrote:Under the
Submitted by patientrenter on April 28, 2009 - 8:58pm.

CA renter wrote:
Under the administration's new program, the interest rate on second mortgages will be reduced to 1% on loans where payments cover interest and principal and to 2% for interest-only loans. The government will subsidize the rate reduction, with the money going to the mortgage investor.
----------------------

Can't the servicers lower the rates to 1% (or even 0%!) all by themselves? Why does the govt (that's us, the taxpayers...again) have to subsidize anything? These are the lenders' loans, and it's up to them to modify them however they see fit. They can reduce principal or lower rates without any govt assistance.

Can somebody please explain again WHY we (taxpayers) need to do this?

Quit chattering and hold that bent over position.

CA renter wrote: Can somebody
Submitted by jpinpb on April 28, 2009 - 9:17pm.

CA renter wrote:

Can somebody please explain again WHY we (taxpayers) need to do this?

Because the whole economy will collapse otherwise.

'Government's view of the
Submitted by Aecetia on April 28, 2009 - 9:21pm.

'Government's view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.'

Ronald Reagan

CA renter wrote: Can somebody
Submitted by Arraya on April 28, 2009 - 9:26pm.

CA renter wrote:

Can somebody please explain again WHY we (taxpayers) need to do this?

Because if we don't, the terrorist win...

Well, that really does sum it
Submitted by jpinpb on April 28, 2009 - 9:26pm.

Well, that really does sum it up.

Although I would've thought it would be more like how can we legally arrange to have money taken from the citizens, maybe have them voluntarily have them give us the money.

Honestly I have to say that
Submitted by SD Realtor on April 28, 2009 - 9:33pm.

Honestly I have to say that over the past year I have never been so disillushioned by our government regardless of party or affiliation. I am now so cynical and disgusted that I am beside myself. From the bailouts to the spending to measures of increased censorship, telling us what we can do, what is good for us, what we should listen to...

In the 5 decades I have been a citizen of this country I have never been so fearful of my own government.

I know it is off topic but the concept of localism which is essentially the replacement of the fairness doctrine scares the sheeit out of me.

So much for the Freedom of
Submitted by Aecetia on April 28, 2009 - 9:39pm.

So much for the Freedom of Speech:
The House of Representatives has voted to urge a conference committee to add "sexual orientation, gender and disability" to federal hate-crimes law, a development some observers say would muzzle Christians who speak out against homosexuality.

On Sept. 28, the House voted 213-186 to pass a procedural motion encouraging a conference committee to include the hate-crimes legislation in the final version of the Defense Authorization Act (H.R. 4200).

http://www.worldnetdaily.com/news/articl...

SD Realtor wrote:...I know it
Submitted by patientrenter on April 28, 2009 - 9:44pm.

SD Realtor wrote:
...I know it is off topic but the concept of localism which is essentially the replacement of the fairness doctrine scares the sheeit out of me.

Huh? Please explain, SDR.

patient renter go to google
Submitted by SD Realtor on April 29, 2009 - 10:33am.

patient renter go to google and type in fairness doctrine or type in localism and go to some of the links and you will learn more about it.

The funny thing is that I don't really listen to much right wing radio but last time I checked, I have the freedom to listen to whatever radio station I want to listen to. Also last I checked, radio stations were free to select whatever format they wanted to broadcast and usually that was based on the advertising revenue that would be generated.

So now the government feels as if there should be regulatory structures put in place. Like I said, last time I checked I thought we all had the freedom to listen to whatever we wanted, whatever was provided to us. So now we still have that freedom but what is provided to us will be regulated. Oh I guess then there is no problem.

*******

If you do not believe that the government can do the same thing with other mediums of communication such as the internet then you are dead wrong.

*******

Funny how all of this is happening but nobody seems to really care.

One day we will all wake up to a vastly different society then the one we all grew up in. This scares the crap out of me.

I'm with you SD R. Disgusted
Submitted by evolusd on April 29, 2009 - 1:13pm.

I'm with you SD R. Disgusted is the perfect word to describe the way I feel. I've been seriously considering taking my wife, kids and life savings to some small town with a low cost of living and just LIVE. No job, pay no taxes, not have to deal with the rat race we're all in. Maybe have a small farm and vegetable garden...solar, water catchment, etc. JUST LIVE and enjoy my family!!!

Anyone know a good place where land is cheap, people are good and the weather isn't unbearable? Maybe we could all start a Pigg commune!!!

Many years ago before this
Submitted by jpinpb on April 29, 2009 - 1:26pm.

Many years ago before this bubble started, I was looking in Taos, New Mexico. But before you knew it, the bubble disease spread there too. Not to the degree here. They have many sunny days, but even though it's sunny, it's cold in the winter (obviously, they have skiing).

SD Realtor wrote:patient
Submitted by flu on April 29, 2009 - 1:39pm.

SD Realtor wrote:
patient renter go to google and type in fairness doctrine or type in localism and go to some of the links and you will learn more about it.

The funny thing is that I don't really listen to much right wing radio but last time I checked, I have the freedom to listen to whatever radio station I want to listen to. Also last I checked, radio stations were free to select whatever format they wanted to broadcast and usually that was based on the advertising revenue that would be generated.

So now the government feels as if there should be regulatory structures put in place. Like I said, last time I checked I thought we all had the freedom to listen to whatever we wanted, whatever was provided to us. So now we still have that freedom but what is provided to us will be regulated. Oh I guess then there is no problem.

*******

If you do not believe that the government can do the same thing with other mediums of communication such as the internet then you are dead wrong.

*******

Funny how all of this is happening but nobody seems to really care.

One day we will all wake up to a vastly different society then the one we all grew up in. This scares the crap out of me.

It's ironic when our own country (who constantly criticize China's record on free speech) is getting more "regulated" by the day. I wonder what things will look like 10 years from now.

CA renter wrote: Can somebody
Submitted by San Diego RE Bear on April 29, 2009 - 9:30pm.

CA renter wrote:

Can somebody please explain again WHY we (taxpayers) need to do this?

For the children CA renter! It's all for the children!

(:D Sorry - couldn't resist.)