I JUST Became My Father!

By
Real Estate Agent with McEnearney Associates, Inc.

 

HAMP for Investors Announced

I just saw an announcement on Bloomberg TV that the HAMP or Home Affordable Modification Program will be extended to investors for up to 4 rental properties.  Starting in May, investors can make application for a loan modification that can include reduced interest rates, increasing the length of the loan, and principal forgiveness.  One caveat is that the property must remain as a rental, though I did not hear what length of time is imposed for participation.

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 Where has personal responsibility gone in today’s world???

Purchase a primary residence with a no documentation loan that you knew you couldn’t afford in the best of times.  Stay in the property for months/years with paying a mortgage or property taxes… shrug it off.

Take out big college loans for a degree with limited career potential/income at an expensive college when a state university would have done, make minimum payments for 20-25 years and then it is forgiven… no sweat.

I may have just become my father in that I’m a bit alarmed & irritated with the way some people have totally forgotten that decisions have consequences and expect someone else to take care of them when it doesn't turn out.  We all want to get through this financial crisis, but have we taught anyone who is listening that there are no moral hazards left???

I welcome your opinions, whatever they might be.

 

Posted by

 

AJ Heidmann ~ CRS,  ABR

Cell 703-474-1260 ~ Office 703-717-6324 ~ Fax 703-839-8283

AJ@AJHeidmann.com

www.AJHeidmann.com

McEnearney Associates, Inc.

4720 Lee Highway, Arlington, VA  22207

Licensed in Virginia

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Rainer
251,980
Karen Hawkins, MBA - Langley & Surrey, BC
Royal Pro Real Estate Network - Langley, BC

Great title, AJ - I think we've all had our 'parent' moments! With the recent economic issues and banking/housing crisis still very fresh, you'd think we'd learn...?

Mar 08, 2012 05:25 AM #6
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Karen - You would think, but as a whole we seem to have a case of amnesia.

Mar 08, 2012 05:39 AM #7
Rainer
152,649
House Hunt
HouseHunt.com - Huntington Beach, CA

The older I get, the more I become my parents. My teenage self would be horrified! Thanks for the laugh, AJ, I can totally relate.

Mar 08, 2012 08:04 AM #8
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John McCormack, CRS
Albuquerque Homes Realty - Albuquerque, NM
Honesty, Integrity, Results, Experienced. HIRE Me!

Those parent moments can be scary and are eye openers for sure! I too can relate my friend.  Have a great day.

Mar 08, 2012 06:26 PM #9
Rainmaker
1,106,726
Al Raymondi
Ocean View Realty Group in Ormond By The Sea Florida - Ormond Beach, FL
Ormond By The Sea Florida - Home and Condo Sales

Some folks just have the attitude that the government or someone owes them and they have no fear of making stupid decisions.

Mar 08, 2012 09:39 PM #10
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Jaime - My teenage self would be horrified too!

John - I expect that there will be more to come...

Al - I worry that this is becoming more and more prevalent, and personal responsibility is fading out.

Mar 09, 2012 09:44 AM #11
Rainmaker
1,335,235
Nick T Pappas
Assoc. Broker/Broker ABR, CRS, SFR, e-Pro, @Homes Realty Group, @HomesBirmingham & Providence Property Mgmnt, LLC Hun... - Huntsville, AL
Madison & Huntsville Alabama Real Estate Resource

AJ, the lack of responsibility issue is one I felt has been coming on for a while now.  I see it in the way some children are being raised...as little as a generation or two ago the mind set was different...it wasn't the "ME NOW" mind set of today.  I'm not saying that all youngsters or adults are of that mind set, but it's tough to stand tall when so many around you are slouching.

Mar 09, 2012 12:41 PM #12
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Nick - I agree and your last sentence sums it up perfectly!  Thanks for stopping by.

Mar 11, 2012 06:52 AM #13
Rainmaker
3,549,332
Michael Jacobs
Pasadena, CA
Los Angeles Pasadena 818.516.4393

AJ -- there can be certain sense of satisfaction knowing you are becoming/or became your parents --- it's another sign of growth.

Mar 18, 2012 02:44 PM #14
Rainmaker
1,036,703
Kathy Clulow
RE/MAX All-Stars Realty Inc. Brokerage - Uxbridge, ON
Trusted For Experience - Respected For Results

AJ - this should have been a featured post ..... while I believe we need to be more compassionate and caring there are issues here that go beyond the norm ..... there is something wrong with a society that does not take any responsibility, or is not held accountable, for it's actions and as I see it this is the slippery road we are headed down just three intersections away from what ever comes next.

Mar 20, 2012 03:35 AM #15
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Richard Weisser
Richard Weisser Realty - Newnan, GA
Richard Weisser Retired Real Estate Professional

AJ...

I have lost quite a bit of money on some stocks ... how do I get a bailout? I agree, what has happened to personal responsibility?

Mar 20, 2012 09:54 PM #16
Rainmaker
894,912
Gail Robinson
William Raveis Real Estate - Southport, CT
CRS, GRI, e-PRO Fairfield County, CT

Let's have a little compassion for the small investor...

I have a client who will be delighted to know about this.  She used her entire home equity line on her home to buy a three family rental to provide her with income in her retirement years.  (I was the listing agent at the the time of purchase and she was represented by a buyer agent, so don't blame me.)  Historically, properties have increased in value 4% per year until the "housing bubble" and it's deflation 2000 to present, so it wasn't a particularly risky investment at the time.  Now she has to do a short sale on the property, except that lenders don't like to do short sales on investment properties and she still has to pay back her home equity loan.

I read in the paper about a young man who came to this country and lived very frugally to invest in properties and build wealth.  He had a number of investment properties and lost them all in market downturn.

Investors aren't just wealthy folks who can afford to take a hit.  They are also people, who looked at the historical increase in value of homes and saw it as a safe investment over time.  Unfortunately, they had no way of foreseeing the market downturn and unemployment levels that would cause tenants to miss payments and leave their units vacant.

Mar 20, 2012 10:31 PM #17
Rainmaker
526,014
Dave Halpern
Keller Williams Realty Louisville East (502) 664-7827 - Louisville, KY
Louisville Short Sale Expert

All the permutations of HAMP have failed before. We'll see if this one succeeds.

Mar 20, 2012 10:43 PM #18
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Bryan Robertson
Los Altos, CA

A lot of so-called "investors" back during the boom were people unqualified to buy but who got loans anyway.  This might help them or it just may delay the inevitable.

Mar 20, 2012 10:48 PM #19
Rainmaker
199,859
Brian Kuhns
Coldwell Banker Roth Wehrly Graber - Fort Wayne, IN
Fort Wayne Real Estate by Brian Kuhns

Remind me not walk across your lawn AJ. Seriously, it is alarming how enabled we have become as a society and I am just as disheartened as you are about it....not raising my kids that way!

Mar 20, 2012 11:18 PM #20
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Gary Woltal
Keller Williams Realty - Flower Mound, TX
Assoc. Broker Realtor SFR Dallas Ft. Worth

AJ, I understand that personal responsibility thing well, and sometimes we turn into grumpy old men trying to change the world. Others will not be responsible and it seems the government programs encourage them.

Mar 21, 2012 07:28 AM #21
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Michael - As long as it doesn't mean I'm maturing

Kathy - We are definitely on the same page

Richard - That is the problem, where does one draw the line.  The only reason that can support this at least partially is to help right the overall housing market.  I would feel better if the investors who got pricipal reduction had to earn it over several years and then share any increase in value at the point of sale.

Mar 22, 2012 01:37 AM #23
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Gail - I have compassion, but just because things didn't work out as planned, doesn't automatically equate to relief.  If the lender has to take a loss on the principal, it should be earned over multiple years and any appreciation should be shared with the lender when it is sold down the road. 

Dave - It would be nice if it actually had a measurable impact in the market.

Bryan - I remember an article on the cover of Money Magazine back in 2006 glamorizing newbie investors who planned on flipping their property purchases.  I am willing to bet that most of them are already washed out of the market.

Mar 22, 2012 01:50 AM #24
Rainmaker
532,746
AJ Heidmann ~ CRS
McEnearney Associates, Inc. - Alexandria, VA
YOUR Alexandria & Arlington, VA Real Estate Expert

Brian - That's my main concern... what are we teaching the population as a whole and specifically our kids.

Gary - When the Government tries to back stop everything, things get muddled & expensive.

Erica - Totally agreed.  Though I will agree with Gail #17 in that the scale of the downturn was unprecedented.

Mar 22, 2012 01:54 AM #25
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John McCormack, CRS
Albuquerque Homes Realty - Albuquerque, NM
Honesty, Integrity, Results, Experienced. HIRE Me!

AJ - Just dropping by to wish you an awesome Saturday in all you do!  It's going to beautiful in the Q, clear sky, calm and mid 70's.  I hope to make it a day of yard work.   I haven't had a day off in a long time and we're way behind in our spring cleaning. 

Mar 23, 2012 11:13 PM #26
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AJ Heidmann ~ CRS

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