McCain’s new proposal to fix housing market

[Ren]

[quote=CBad]I was embarrassed and filled with disgust for both of them last night. I just cannot believe this is the best we came up with and the two choices we have to chose from.[/quote]

This is the reason I find myself unable to watch the debates. Half the time I would spend cringing while they humiliate themselves and the country, and the other half getting more and more angry at the policies of both.

I spend a lot of time now looking at housing and employment in Europe. I’m not quite ready to commit to that yet, but it’s no longer out of the question.

[gromit]

[quote=publicdefender]so insteadof the past practices where appraisers would be paid to come in with high appraisals, now the emphasis will be coming in with the lowest possible appraisal and then claiming poverty? and if these regster as sales, wont this practice decimate housing prices. setting aside the moral hazard issues, which are obviously kind of sickening for responsible people who waited to buy, wouldn’t this accelerate a race to the bottom for “market value” as the lower the appraisal the better deal the homeowner (that term needs to be made illegal under this new law and its use made punishable by ineligibility for any further govt aid)) would receive. who would jump in and buy a house when all the current people are getting free money from the govt? wouldnt you just wait for that fiasco to play out so the market can do its work again?[/quote]

Hear, hear!

[gromit]

[quote=publicdefender]so insteadof the past practices where appraisers would be paid to come in with high appraisals, now the emphasis will be coming in with the lowest possible appraisal and then claiming poverty? and if these regster as sales, wont this practice decimate housing prices. setting aside the moral hazard issues, which are obviously kind of sickening for responsible people who waited to buy, wouldn’t this accelerate a race to the bottom for “market value” as the lower the appraisal the better deal the homeowner (that term needs to be made illegal under this new law and its use made punishable by ineligibility for any further govt aid)) would receive. who would jump in and buy a house when all the current people are getting free money from the govt? wouldnt you just wait for that fiasco to play out so the market can do its work again?[/quote]

Hear, hear!

[gromit]

[quote=publicdefender]so insteadof the past practices where appraisers would be paid to come in with high appraisals, now the emphasis will be coming in with the lowest possible appraisal and then claiming poverty? and if these regster as sales, wont this practice decimate housing prices. setting aside the moral hazard issues, which are obviously kind of sickening for responsible people who waited to buy, wouldn’t this accelerate a race to the bottom for “market value” as the lower the appraisal the better deal the homeowner (that term needs to be made illegal under this new law and its use made punishable by ineligibility for any further govt aid)) would receive. who would jump in and buy a house when all the current people are getting free money from the govt? wouldnt you just wait for that fiasco to play out so the market can do its work again?[/quote]

Hear, hear!

[gromit]

[quote=publicdefender]so insteadof the past practices where appraisers would be paid to come in with high appraisals, now the emphasis will be coming in with the lowest possible appraisal and then claiming poverty? and if these regster as sales, wont this practice decimate housing prices. setting aside the moral hazard issues, which are obviously kind of sickening for responsible people who waited to buy, wouldn’t this accelerate a race to the bottom for “market value” as the lower the appraisal the better deal the homeowner (that term needs to be made illegal under this new law and its use made punishable by ineligibility for any further govt aid)) would receive. who would jump in and buy a house when all the current people are getting free money from the govt? wouldnt you just wait for that fiasco to play out so the market can do its work again?[/quote]

Hear, hear!

[gromit]

[quote=publicdefender]so insteadof the past practices where appraisers would be paid to come in with high appraisals, now the emphasis will be coming in with the lowest possible appraisal and then claiming poverty? and if these regster as sales, wont this practice decimate housing prices. setting aside the moral hazard issues, which are obviously kind of sickening for responsible people who waited to buy, wouldn’t this accelerate a race to the bottom for “market value” as the lower the appraisal the better deal the homeowner (that term needs to be made illegal under this new law and its use made punishable by ineligibility for any further govt aid)) would receive. who would jump in and buy a house when all the current people are getting free money from the govt? wouldnt you just wait for that fiasco to play out so the market can do its work again?[/quote]

Hear, hear!

[temeculaguy]

I am not really participating in the politics, but I can explain what he was saying. The details are too complicated for the masses. I don’t like either guy, so politics aside, his statement was missing details, key details. Maybe because it was too complicated to explain, maybe he wanted fb’s to think they were getting a free ride.

FDIC writedowns, FHA secure, Fannie and freddie writedowns all follow a general theme and the largest misconception is that nothing is actually forgiven, rather it is suspended. Eating a few hundred grand per house is too expensive to help more than a few people. Eating the interest on a portion of the principal allows them to “help” more people, many more, a few hundred more, with the same dollars.

Wilbur Ross has proposed a three way arrangement with a private company, but the current gov’t stuff is a two way deal.

I’ve posted before that when you look at how the write down works, it is actually far worse for the fb than walking away, but they do get to have a roof over their head and they get to pay about 50% more than rent without ever building equity. When the market recovers or when they sell, whatever was “re-worked” has to be paid back and no refi or helocs can ever be taken until the rework has been paid. When you look at it, it is nothing more than a long term teaser rate, in fact it’s worse, but they think it will buy enough years for the recovery.

scenario: fb buys for 500k, 0 down. Today house is worth 300k. fb cant pay his fully amortized payment with impounds of 4k. rework takes .38 of his/her gross, figures what portion of the fully amortized that would cover, lets say 7k gross per month as $2500 a month and that is the new payment. That equates to paying on 300k, the value of the home. 200k is suspended and does not accrue interest (that interest is the cost to the gov or bank). When the market rebounds in 5 years and it sell or refi’s at 500k, fb gets nothing, bank or gov gets the whole 500. If it goes to 600k, bank gets half the profit to offset the loss of interest and fb gets 50k.

FB gets to deduct the 2500 like any homeowner would, but they are really just a renter and need to gain more than 200k in value before actually making anything and even then they only get half.

Their neighbor buys for 300k this week and when fb sells at 600k in the future and enjoys his 50k, the neighbor gets 300k. This is why only 1 in 8 that are eligible are taking advantage of this “help.”

If I may quote a great twilight zone episode (to serve mankind) “It’s a cookbook.”

[temeculaguy]

I am not really participating in the politics, but I can explain what he was saying. The details are too complicated for the masses. I don’t like either guy, so politics aside, his statement was missing details, key details. Maybe because it was too complicated to explain, maybe he wanted fb’s to think they were getting a free ride.

FDIC writedowns, FHA secure, Fannie and freddie writedowns all follow a general theme and the largest misconception is that nothing is actually forgiven, rather it is suspended. Eating a few hundred grand per house is too expensive to help more than a few people. Eating the interest on a portion of the principal allows them to “help” more people, many more, a few hundred more, with the same dollars.

Wilbur Ross has proposed a three way arrangement with a private company, but the current gov’t stuff is a two way deal.

I’ve posted before that when you look at how the write down works, it is actually far worse for the fb than walking away, but they do get to have a roof over their head and they get to pay about 50% more than rent without ever building equity. When the market recovers or when they sell, whatever was “re-worked” has to be paid back and no refi or helocs can ever be taken until the rework has been paid. When you look at it, it is nothing more than a long term teaser rate, in fact it’s worse, but they think it will buy enough years for the recovery.

scenario: fb buys for 500k, 0 down. Today house is worth 300k. fb cant pay his fully amortized payment with impounds of 4k. rework takes .38 of his/her gross, figures what portion of the fully amortized that would cover, lets say 7k gross per month as $2500 a month and that is the new payment. That equates to paying on 300k, the value of the home. 200k is suspended and does not accrue interest (that interest is the cost to the gov or bank). When the market rebounds in 5 years and it sell or refi’s at 500k, fb gets nothing, bank or gov gets the whole 500. If it goes to 600k, bank gets half the profit to offset the loss of interest and fb gets 50k.

FB gets to deduct the 2500 like any homeowner would, but they are really just a renter and need to gain more than 200k in value before actually making anything and even then they only get half.

Their neighbor buys for 300k this week and when fb sells at 600k in the future and enjoys his 50k, the neighbor gets 300k. This is why only 1 in 8 that are eligible are taking advantage of this “help.”

If I may quote a great twilight zone episode (to serve mankind) “It’s a cookbook.”

[temeculaguy]

I am not really participating in the politics, but I can explain what he was saying. The details are too complicated for the masses. I don’t like either guy, so politics aside, his statement was missing details, key details. Maybe because it was too complicated to explain, maybe he wanted fb’s to think they were getting a free ride.

FDIC writedowns, FHA secure, Fannie and freddie writedowns all follow a general theme and the largest misconception is that nothing is actually forgiven, rather it is suspended. Eating a few hundred grand per house is too expensive to help more than a few people. Eating the interest on a portion of the principal allows them to “help” more people, many more, a few hundred more, with the same dollars.

Wilbur Ross has proposed a three way arrangement with a private company, but the current gov’t stuff is a two way deal.

I’ve posted before that when you look at how the write down works, it is actually far worse for the fb than walking away, but they do get to have a roof over their head and they get to pay about 50% more than rent without ever building equity. When the market recovers or when they sell, whatever was “re-worked” has to be paid back and no refi or helocs can ever be taken until the rework has been paid. When you look at it, it is nothing more than a long term teaser rate, in fact it’s worse, but they think it will buy enough years for the recovery.

scenario: fb buys for 500k, 0 down. Today house is worth 300k. fb cant pay his fully amortized payment with impounds of 4k. rework takes .38 of his/her gross, figures what portion of the fully amortized that would cover, lets say 7k gross per month as $2500 a month and that is the new payment. That equates to paying on 300k, the value of the home. 200k is suspended and does not accrue interest (that interest is the cost to the gov or bank). When the market rebounds in 5 years and it sell or refi’s at 500k, fb gets nothing, bank or gov gets the whole 500. If it goes to 600k, bank gets half the profit to offset the loss of interest and fb gets 50k.

FB gets to deduct the 2500 like any homeowner would, but they are really just a renter and need to gain more than 200k in value before actually making anything and even then they only get half.

Their neighbor buys for 300k this week and when fb sells at 600k in the future and enjoys his 50k, the neighbor gets 300k. This is why only 1 in 8 that are eligible are taking advantage of this “help.”

If I may quote a great twilight zone episode (to serve mankind) “It’s a cookbook.”

[temeculaguy]

I am not really participating in the politics, but I can explain what he was saying. The details are too complicated for the masses. I don’t like either guy, so politics aside, his statement was missing details, key details. Maybe because it was too complicated to explain, maybe he wanted fb’s to think they were getting a free ride.

FDIC writedowns, FHA secure, Fannie and freddie writedowns all follow a general theme and the largest misconception is that nothing is actually forgiven, rather it is suspended. Eating a few hundred grand per house is too expensive to help more than a few people. Eating the interest on a portion of the principal allows them to “help” more people, many more, a few hundred more, with the same dollars.

Wilbur Ross has proposed a three way arrangement with a private company, but the current gov’t stuff is a two way deal.

I’ve posted before that when you look at how the write down works, it is actually far worse for the fb than walking away, but they do get to have a roof over their head and they get to pay about 50% more than rent without ever building equity. When the market recovers or when they sell, whatever was “re-worked” has to be paid back and no refi or helocs can ever be taken until the rework has been paid. When you look at it, it is nothing more than a long term teaser rate, in fact it’s worse, but they think it will buy enough years for the recovery.

scenario: fb buys for 500k, 0 down. Today house is worth 300k. fb cant pay his fully amortized payment with impounds of 4k. rework takes .38 of his/her gross, figures what portion of the fully amortized that would cover, lets say 7k gross per month as $2500 a month and that is the new payment. That equates to paying on 300k, the value of the home. 200k is suspended and does not accrue interest (that interest is the cost to the gov or bank). When the market rebounds in 5 years and it sell or refi’s at 500k, fb gets nothing, bank or gov gets the whole 500. If it goes to 600k, bank gets half the profit to offset the loss of interest and fb gets 50k.

FB gets to deduct the 2500 like any homeowner would, but they are really just a renter and need to gain more than 200k in value before actually making anything and even then they only get half.

Their neighbor buys for 300k this week and when fb sells at 600k in the future and enjoys his 50k, the neighbor gets 300k. This is why only 1 in 8 that are eligible are taking advantage of this “help.”

If I may quote a great twilight zone episode (to serve mankind) “It’s a cookbook.”

[temeculaguy]

I am not really participating in the politics, but I can explain what he was saying. The details are too complicated for the masses. I don’t like either guy, so politics aside, his statement was missing details, key details. Maybe because it was too complicated to explain, maybe he wanted fb’s to think they were getting a free ride.

FDIC writedowns, FHA secure, Fannie and freddie writedowns all follow a general theme and the largest misconception is that nothing is actually forgiven, rather it is suspended. Eating a few hundred grand per house is too expensive to help more than a few people. Eating the interest on a portion of the principal allows them to “help” more people, many more, a few hundred more, with the same dollars.

Wilbur Ross has proposed a three way arrangement with a private company, but the current gov’t stuff is a two way deal.

I’ve posted before that when you look at how the write down works, it is actually far worse for the fb than walking away, but they do get to have a roof over their head and they get to pay about 50% more than rent without ever building equity. When the market recovers or when they sell, whatever was “re-worked” has to be paid back and no refi or helocs can ever be taken until the rework has been paid. When you look at it, it is nothing more than a long term teaser rate, in fact it’s worse, but they think it will buy enough years for the recovery.

scenario: fb buys for 500k, 0 down. Today house is worth 300k. fb cant pay his fully amortized payment with impounds of 4k. rework takes .38 of his/her gross, figures what portion of the fully amortized that would cover, lets say 7k gross per month as $2500 a month and that is the new payment. That equates to paying on 300k, the value of the home. 200k is suspended and does not accrue interest (that interest is the cost to the gov or bank). When the market rebounds in 5 years and it sell or refi’s at 500k, fb gets nothing, bank or gov gets the whole 500. If it goes to 600k, bank gets half the profit to offset the loss of interest and fb gets 50k.

FB gets to deduct the 2500 like any homeowner would, but they are really just a renter and need to gain more than 200k in value before actually making anything and even then they only get half.

Their neighbor buys for 300k this week and when fb sells at 600k in the future and enjoys his 50k, the neighbor gets 300k. This is why only 1 in 8 that are eligible are taking advantage of this “help.”

If I may quote a great twilight zone episode (to serve mankind) “It’s a cookbook.”

[an]

[quote=esmith]During his first two years, Democrats had 59% in the House and 56% in the Senate. Republicans had a slim majority after 1995, but they never had more than 55% in either chamber.[/quote]
Sorry, you’re right, only 6 of the 8 years. So, in order for us to be prosperous under Obama like Clinton, we need to give a slight advantage to the Republicans in the House and Senate, right? When was the last time where one party control everything and we came out better than we came in?

Unlike you, I don’t trust politicians, regardless of party. So I want their power to be in checked by the other party.

[an]

[quote=esmith]During his first two years, Democrats had 59% in the House and 56% in the Senate. Republicans had a slim majority after 1995, but they never had more than 55% in either chamber.[/quote]
Sorry, you’re right, only 6 of the 8 years. So, in order for us to be prosperous under Obama like Clinton, we need to give a slight advantage to the Republicans in the House and Senate, right? When was the last time where one party control everything and we came out better than we came in?

Unlike you, I don’t trust politicians, regardless of party. So I want their power to be in checked by the other party.

[an]

[quote=esmith]During his first two years, Democrats had 59% in the House and 56% in the Senate. Republicans had a slim majority after 1995, but they never had more than 55% in either chamber.[/quote]
Sorry, you’re right, only 6 of the 8 years. So, in order for us to be prosperous under Obama like Clinton, we need to give a slight advantage to the Republicans in the House and Senate, right? When was the last time where one party control everything and we came out better than we came in?

Unlike you, I don’t trust politicians, regardless of party. So I want their power to be in checked by the other party.

[an]

[quote=esmith]During his first two years, Democrats had 59% in the House and 56% in the Senate. Republicans had a slim majority after 1995, but they never had more than 55% in either chamber.[/quote]
Sorry, you’re right, only 6 of the 8 years. So, in order for us to be prosperous under Obama like Clinton, we need to give a slight advantage to the Republicans in the House and Senate, right? When was the last time where one party control everything and we came out better than we came in?

Unlike you, I don’t trust politicians, regardless of party. So I want their power to be in checked by the other party.

[Author]

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