Lawmakers say they want to speed FAST, FAST, FAST RELIEF to homeowners with mortgage woes. But the leading remedy on the Hill, the Frank-Dodd FHA Refinance Plan (H.R. 5830), will take many months before it has any effect at all. Moreover, it’s the wrong prescription. Though not as bad as some earlier proposals, the Frank-Dodd proposal still remains “essentially a government buyout of problem mortgages disguised as a refinancing plan,” Heritage Foundation expert David John writes in a May 6 research paper. And anyone expecting quick relief from the bill …
“So you bought an overpriced house or cashed out your home equity like an ATM? Here’s an idea: Take responsibility for your actions!” That’s the mood over at AngryRenter.com. The plain-spoken Web site run by FreedomWorks gives voice to what might be termed “the Silent Minority” of the mortgage- bailout debate: the one-third of American households that don’t have a mortgage. Although less than 2 percent of all homes are in foreclosure, the Web site notes, lawmakers are tripping over themselves to bail out the homeowners with tax dollars taken from …
USA Today’s take on the mortgage mess posed a crucial question: “Should taxpayers in Vermont be asked to bail out home buyers in Nevada?” The nation’s No.1 newspaper went on to note: “The answer now taking shape in Washington appears to be, ‘Yes.’” But the multi-billion dollar question for taxpayers in Vermont and other states that didn’t plunge headfirst into risky housing deals is “Why? Why should we be stuck with the tab?” One answer to that question: “Politics.” Let’s go to the map: The housing bailout plans before Congress …
As Congress mulls what it can do to untangle the housing mess, it should take care to limit its largesse to helping only those people who really need help. We’ve already noted that Washington shouldn’t rush to bail out vacation homes. Or frauds. Or lenders who winked at frauds and gave them loans anyway. Help should also come with a very important string attached: no free lunch. Any borrower or lender must be required to have a substantial stake in any loan refinanced with the backing of U.S. taxpayers. Unless …
The New York Times is shocked – SHOCKED – to learn the Senate’s legislative remedy for the mortgage mess offers surprisingly little relief for folks with problem mortgages, but gives huge tax breaks to “automakers, airlines, alternative energy producers” and others. Doubtless the Gray Lady will be shocked at how the House proposes to restore balance: By drafting legislation that uses the taxes of responsible, middle-class homeowners and renters to bail out most everyone who’s in over their heads in mortgage payments. And “everyone” means everyone. Even those who lied …
President Bush and some members of Congress want to dub the Federal Housing Administration as the White Knight who will rescue America from the mortgage mess. They want the agency to help homeowners refinance their subprime loans by offering to guarantee lenders it will cover the tab if the refinanced deals go into foreclosure. But a New York Times report notes that the FHA is no shape to rescue anybody. Indeed, it’s “grappling with financial woes of its own” and may have to be bailed out by taxpayers, too. The …
The early narrative of the housing market collapse featured all the usual suspects: sleazy mortgage bankers, shadowy lenders and pushy Wall Street brokers – all of them preying on unsuspecting homebuyers. But now we’re starting to get, as radio legend Paul Harvey puts it, “the rest of the story.” Turns out that not all borrowers were naïve waifs lured into unaffordable mortgages by unscrupulous lenders. As Steven Malanga notes in an essay for RealClearMarkets.com, “many of these borrowers were irresponsible at best, and complicit at worse.” Not only did the …
