Very interesting Frank. This rate freezing proposal has so many negative scenarios attached to it it is mindboggling. I had not thought of this one before. A valid concern for sure.

I can't see this rate freezing flying, and I do agree that any subsidies need to be paid back if there is equity in the home within a certain time period. I smell another scam.

I'm sorry, I still am not smart enough to understand this program. You have to be current on your mortgage, but have a score under 660? And if their rate is frozen for 5 years, their payment stays the same. But if they have by chance maxed out all of their other credit scores in order to get their score low enough, and if they are on a fixed income, as most Americans are, and the cost of living keeps going up, it seems like a pretty short term fix. How long until gas is $4 a gallon, and commute times double due to the roads becoming more and more clogged? And don't forget, they probably can not refi due to the slip in the market, so no financial net there. Can they even refi if they are in this program? 

Sorry Frank - I don't mean to hijack your blog. I just don't get it.

This link suggests the freeze would aim to only help a few people and the government would not be involved.  I don't think there is going to be any "free money" for anyone...

 http://www.breitbart.com/article.php?id=D8TC48RG0&show_article=1

Few people? This article says 1.2 Million people

http://money.cnn.com/2007/12/07/real_estate/freeze_fairness.moneymag/index.htm

Frank,

I share your concern...the fed 'monkeying' with rates is scary...and are these mortgages assumable!!! Thanks,   Fran

Hi Frank, thanks for the post!  It will be interesting to see how this all works out.  So many things to consider!

Hey Fran,

Funny, assumable frozen mortgages?? Brillian question.

I would like to see some belts and braces put on this program to ensure that those that truly need assitance get the help the need and those that deserve to lie (lay?) in the bed they made do so. Specifically, any borrower seeking relief under this program should be asked to substantiate all information furnished by them to the lender in connection with the loan application and underwriting process. If any information can not be substantiated, the borrower should be disqualified for relief. If any information is found out to be fraudulent, the borrower should not only be disqualified, but also face criminal/civil penalites for defrauding the bank.

I did a post today about t-shirts as commentary on the market.  One of the t-shirts I saw said, "I planned within my means and got a fixed rate mortgage...where's my bailout??"  The media isn't picking it up yet, but as details of this plan are fleshed out and announced, I think you're going to hear a lot more of that sentiment.

 For the record, I didn't buy the last couple of years because home prices and the loans needed to get into them didn't make sense.  Maybe I shouldn't have cared so I could have gotten my bailout, too.

 You can see some of the other shirt designs I found in my blog, Foundation. 

Assumable where did it say assumable did i miss something?  anyhow the plan fixes little and just slows the foreclosure market in an effort to assist the consumer confidence and boost the dollar.  It has little to do with helping homeowners if you look at the big picture.