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Well, The Feds Might Have Opened Up Pandoras Box!

I just got this email, from a client of mine. He just got word that the Feds are going to bail out homeowners who cannot make their mortgage payments due to a reset in Rate.

I am wondering if this will set a huge amount of people off.

Here is his email:

Just joking, but should I stop paying my mortgage go into default so I can freeze my interest rate. I think that's a crock of *$#%&% that people get bailed out that can't pay their mortgage while people like me who are responsible get screwed up the @$$. Gotta love America.

cheers

I took the liberty to censor the profanity.

I have a feel we are going to have some upset good doers out there because of our governments actions.

What do you think?

Posted by Gary Miljour - Mortgage Lending for Tempe Arizona on 12/06/2007 02:40 PM

Comments (11)

mortgage bailout, arizona news and community, tempe news and community, mortgage news

11 Comments on Well, The Feds Might Have Opened Up Pandoras Box!

DEC

2007

It will upset many of those who can pay their mortgages.

I think you raise an amazing point! I can't put my finger on it, but I see where your guy's coming from! So funny he thought to send you a note about it...He obviously thinks very highly of you...

The unfair part... is that the people who took these 3/1 or 5/1 ARMS probably did so because of the low teaser rate. If the FED turns those teaser rates into fixed rates it wouldn't be fair to those that chose the slightly higher fixed rate mortgage from jump street.

Hey Gary - Matt Heaton wrote a post on this exact topic. My feelings on this? Here is an excerpt of my comment:

I feel for consumers who were hoodwinked and they should take the proper action and get the proper help if they were indeed unknowingly put in a bad position with a high cost loan with a false sense of equity position. Yet, as you pointed out, the % of individuals this would actually help is probably very small. What the Government is doing is basically saying to Lenders & Consumers, "You signed a mutually binding contract, but hey.....just forget about all that legal stuff." If they want to save the world so to speak, this isn't the answer. If they want to kill the Mortgage Industry, this just may be.

It will be interesting to see what happens with all those mortgages that are on ARMSs and can't refinance...

your friend used a key word............... Responsible

I see many questions and some issues forth coming

Gary thank you for sharing...What was your response? and how do you feel about it?

I was just wondering about how that was going to work! You have to be unable to meet the higher payments. So do you go out and buy a new Mercedes?

DEC

2007

I'm guessing you are right and the sad part is the people that are calling me asking about this program from my newsletter are disappointed to find out that if they have been late even once in the last 12 months they don't qualify. I wish I had been their agent when they bought the home, but at least they are calling me now!

Todd

DEC

2007

I guess you see the short term implications we are already seeing related to yet another lunitic frenzy some being cooked up to somehow shove the manure back up the goose's rear end.

Ok, now the good news. The fed has no choice but to continue to easy its grip on our monetary supply. We will regain the liquidity to sell something other than agency 30 year paper for a living.

Good thing my kids like ramon noodles, they ate them alot this year.

What doesn't kill you makes you stronger.

Matthew

How about this. Prior to doling out bailouts to those who can't afford the new payment that comes with the reset, the government issues a mandatory automated test. There will be only 5 questions on this test. You must answer 3 out of 5 "yes" to be eligible for assistance.

1. Can you spell "Scapegoat?"

2. Is that someone else's signature on the loan application of closing documents?

3. Was the information provided by you in the loan application truthful?

4. Can you name all current and past members of Menudo?

5. Were you raised by wolves?

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