I had to at least make a mention of the new plan to bail out the Subprime Mess and I was in a Clint Eastwood Western sort of mentality. So, I will relate my feelings to the Good the Bad and The Ugly.
I think that in all, it will help some people... but I just don't believe the way that things are being carried out are in the best interest of the masses for more than one reason.
The Good - There are a lot of loans that are about to jump, some even double. This Congressional Bailout of these borrowers will help those people who are about to get a shock... a BIG shock.
The Bad - OK... so these borrowers have some relief.
Now the big test is will they learn their lesson from the scare and start a financial plan to get themselves on track for the big three issues for a loan application so that they can refinance in the future.
They need to work on:
- Credit
- Income
- Assets
- Also - Equity
The Ugly - now this is where I'm going to be bordering on ranting.
Congressman Barney Frank - are you reading this??
This plan is by far one of the most dangerous pieces of legislation in US History. This was bred from ignorance and arrogance.
I do not care how bad this problem is or will become...
The Mortgage Industry is built upon the freely moving, market driven Mortgage Backed Securities Market. Rates, programs, etc are all based on this FREE market that is without government interference!
The US Government has NO business regulating this market and industry in anyway.
YES! The Homeowners are hurting... but they have been in this position for at least a year and have heard enough news that this storm was coming. Ohh... now I'm unpopular...
But... there are investors around the world who bought into these investments. They made the decision to back risky mortgages and who's right is it to tell them that they do not deserve the returns that they signed up for??
No ones! Especially not the Federal Government of the United States.
For the FULL ARTICLE follow this link to -o-> Florida Mortgage | Subprime Bailout ~ Preliminary views of the plan
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David A. Podgursky, MBA
TheMortgageGoToGuy.com
Your Source for Residential, Commercial, Investment and Relocation Mortgages in Florida
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Bravo, David. I agree.
There is plenty of blame to go around in this one. The Realtors wanted to sell the house and make their commission. The lender's wanted to sell the mortgage and make their commission. And all too many of them told their customer, "Don't worry about it - we will refinance before the rates adjust too far"
But in the final analysis, this is not the government's role to correct this by bailing out all concerned directly.