Boe Lindgren's solution to the economy  

Here is the solution to:

•·         Saving the United States Banking system

•·         Keeping the American homeowner in their home

•·         Boosting the U.S. economy

•·         Establishing better neighborhoods

•·         Keeping rents down

•·         Fixing the housing market

I know that is a lot of stuff to solve, but here you go. Instead of the U.S. government bailing out banks by giving them cash, the government should give it to the people. The homeowners in America would be able to refinance their mortgage loan with the government, regardless of their situation.

How would this work?

The government would let anyone who owns a home (or many homes) refinance at 1%, 40 year fixed. It is strictly rate and term (no cash out). Whatever is owed on the property gets paid off with this new mortgage (late fees, penalties, etc...). Now there is one lien on the property, and the owner cannot get a second behind it (or use the home for any type of collateral). The interest paid on this loan is NOT tax deductible. This is a onetime deal. Rental properties are fine too, let's keep the rents down.

Who wins?

•1)      Banks - they get all their bad debt off the books and are solvent (government refinanced them out of it, instead of handing over cash).

•2)      Homeowners - they get a lower payment and can stay in their home.

•3)      Government - they make tax dollars by getting rid of the single largest deduction & they make 0.5% margin on the money (borrow from the fed at .5%). Oh yea, they also get paid back over the next 40 years.

•4)      The economy - there will be an increase in consumer confidence and people will begin to buy things again. Homeowners will also have more disposable income (lower house payment).

•5)      Renters - the rents can stay lower because landlords have a smaller mortgage payment.

•6)      The housing market - less people will want to sell their home and give up the 1% mortgage. There will then be less supply. Prices will then stabilize.

•7)      Neighborhoods - with more homeownership and less population mobility (no one wants to give up their 1% mortgage) neighborhoods will get established and people will begin to know their neighbors and take more pride in where they live since they will plan on being there longer.

This could all be implemented by the hundreds of loan officers that are struggling. With no underwriting & no appraisal, just title, escrow, and record. This could be accomplished for under $1,500 a home.

By Boe Lindgren, Owner / Broker Ashlar Realty & Licensed Loan Originator, Seattle, WA

boe@lindgren.com www.boeanddebbie.com