CRAM DOWN Mortgages

As a future borrower,

I am fairly certain that I will end up paying for this program via higher fees and interest spreads.

So if you support this program, I've gotta ask: what do you have against me?

Col Swindle

Just heard about this today, so I'm seeking more info.  When the loan is split into secured and unsecured (interest-only) loans, who gets the property lien?  Thanks--I'm hoping that the banks won't be getting a huge gift of property sans forclosure via this bill, as most lendees will likely bail.

I have seen a lot of people hurt by the economic slow down.  Paul obviously this has not happend to you yet.  It will and I hope soon.  People like you hide behide pompous words.  When you personaly are affected I hope you remember your own words.

Veritas,

I find it interesting that you would choose to launch into personal attachs and wish ill on somebody you do not know.  For what it's worth, I have been hurt by the recession.  I decided that I had a choice.  I could respond by crying "Woe is me, there is a recession" or I could seek the opportunity in the economy and prosper from it.  To paraphrase the words of a great thinker: I chose not to participate in the recession and seek the opportunity.

I see on a housingwire.com article that Barney Frank is going to meddle some more with the financial markets.  When will people learn that the market will correct itself.  Intervention only serves to delay, not hasten the recovery. 

This was proven in the 1930's and early 40's.  It wasn't the WPA that pulled America out of the recession, it was World War II.  Hopefully it won't take another world war to stop this one.  Our industrial complex has been so weakened, we couldn't possilby win, but that's another thread altogether.

For the record, I see the misery everyday and I do what I can to help those affected.  I return the grace that God has shown me by helping other people where I can.

I don't have any 401ks or any other retirement and at almost 50 with all my equity gone I have nothing. The bank hired the apprazer. the bank proffitted every step of the way, everyone in the loan prossess knew these numbers were fake. But they road that horse  as long as they could with no regrets.banks were making money hand over fist on the way up and now they're making money on the way down.

Paul,

Not sure what you mean by "Will people get hurt? Yes.  In broad, general terms, these are the people who enjoyed the benefits of this free money.  Now that it's time to pay the piper, they can't pay."  I bought a house for $420k at the peak in Virginia, a small house.  Now this house is worth $250k.  I moved out of Virginia (due to job loss) 2 years ago, and due to the value already dropping and being upside down on a huge mortgage, I opted to lease it for what I could get.  The rent paid to me does not cover the mortgage.  Today, I am looking at paying $250k out of my pocket for the "benefit" of a home over my head during the boom, I don't even live in this house any more.  My tennant has found a bargain house (lots of foreclosures in the area) and is moving out.

Where is the benefit to me?

So if I understand this a "cram down" price is based on the true market value of real estate today, not what it WAS worth a few years ago when the bankers and Wall Street were inflating prices and buying the short side at the same time- the credit default swaps, hedge funds, etc.   Even Moodys and Standard and Poores were in on the scam. They rated the bonds that were worthless that were sold to pension funds, foreign governments, individuals, whomever as AAA without any thought of who would be hurt or displaced by their operations. . They were paid to do so by the Wall Streeters and the bankers that scammed the taxpayers and left us holding the proverbial bag. Now its being disclosed the US Federal government was even paying the regulators and "watchdogs" whose job it was to prevent problems like this millions in bonuses for doing such a good job.

So who does the American taxpayer trust? Are there any penalties for the bond raters that were fraudulent or the scammers that paid them off? How about the feds that bailed them out and still allows them millions in bonuses for getting us into this mess.

So a cram down is a good thing. It is the "self correction" ( as if there weren't any manipulations and schemes that caused this meltdown) device that re-aligns the market to reality. This is the reality. The sooner we stop whining about the past,(not forgetting it) and fire the folks that got us in to this mess( not forgetting them either) we can start to move on.  

So yeah- new interest rates and mortgage principals are a good idea.  Maybe it'll help some people keep their homes and send some messages to the bankers and Wall Streeters and the Feds that are working together to screw them out of them that says they aren't gonna operate with impugnity anymore. I'm pretty sure they'll just find another way to operate and do the same stuff again so what does it matter if a few more Joe Taxpayers get to keep their homes?