Posted by Stamper_WI on 7/23/08 6:27pm
Msg #256500

New housing bailout

Here's a brief explaination of how it works. Bush has withdrwan hi threat to veto this. I wonder if we are going to be attestments?

http://money.cnn.com/2008/07/23/real_estate/housing_rescue_guide/index.htm

Reply by desktopfull on 7/23/08 7:45pm
Msg #256512

Talk about taking advantage of borrowers!

Who in their right mind would agree to give FHA 50% of their profits from a sale of their home? That's what your agreeing to with this bail out. If you sell the 1st yr. they get it all, and it decreases for 5 yrs to 50% and stays the life of the loan. You also have to get their permission to refi if it's within the 1st 5 yrs. Plus your agreeing to give them a 1.5% payment of the principle each year for a mortgage insurance premium for the life of the loan. This is what the Congress and Senate calls a bail out. How about a reality check here folks. The government with this plan is gouging the public worse than the sub-prime mortgage brokers were.

Reply by JanetK_CA on 7/23/08 11:36pm
Msg #256525

Re: Talk about taking advantage of borrowers!

Keep in mind, that these people are walking away from what may be hundreds of thousands of dollars of loan obligations they previously committed to, regardless of the circumstances. Their other options don't look too exciting, either! I haven't looked into this in detail yet, but I think it's a good idea that there are some strings attached. I'd be upset if they were getting a free ride.

Reply by jojo_MN on 7/23/08 11:47pm
Msg #256526

Re: Talk about taking advantage of borrowers!

There are some parts of the country where homeowners paid $400k + for their home, but it is now only worth $250k. These are the ones that will be helped the most. They can no longer afford the loan. In this example, if FHA helped them out with $250k the lender is losing $150k. It s only right that if the borrower sold the house for $300k that they should have to pay it back. Mind you, this is only an example.

JMHO

Reply by Lee/AR on 7/24/08 2:33am
Msg #256531

Re: Talk about taking advantage of borrowers! Nope.

To the best of my knowledge, FHA loans have always contained a 'payback' provision. If there must be a bailout, I think this is a good plan.

Reply by SueW/Tn on 7/24/08 3:38am
Msg #256532

I agree Lee, especially since it's my tax dollars that's

enabling them to do this bail out in the first place. We haven't seen alot of folks up side down in my area, not a whole lot of keeping up with the Jones going on here either. Everytime I think about the BO's who were using that equity to pay off credit cards OR buy the new car/boat/motorcycle I grind my teeth.

Reply by Carolyn Bodley on 7/24/08 8:40am
Msg #256546

Re: Whatever happened to people having to be accountable

for thier own actions? The bail out is bringing the accountability back.

Reply by LynnNC on 7/24/08 8:56am
Msg #256549

I agree...

...especially people with ARM's. When they got the loans they should have taken in account that their payment was likely to go up after the fixed period. The only people that should have gotten an ARM was someone who knew that they would sell before the fixed period was up, not to have a lower payment in order to qualify.

Reply by goodgirl on 7/24/08 10:15am
Msg #256563

And so... the "new" borrowers will pay the feds 1.5% to insure their loans. After they realize what a mess they have not gotten into, the loans will fold, and just what insurance co will be stuck paying off all these bad debts...
Fannie and Freddie are allegedly broke, so that means that now the feds will start bankrupting themselves or other insurance sources. Oh, excuse me, the fed govt is already broke...
This is a real rip-off, again.