Microphone Please ...
Saturday, July 19, 2008
Bush and congress to bailout banks and lenders.
Ok, I recall about 6 years ago going to my local bank lender to apply for a new loan on my current home. I sat with my lender and listed to her tell me "We can pre-approve you for 250-285,000 on your new home." . At the time I pretty much knew the home I wanted and it wasn't going to cost me $285,000 bucks. At the time I pretty much knew that if I wanted to pay for a $285,000 mortgage I was going to have to skimp on quite a few luxuries. i.e. eating, toilet paper, tshirt on my back etc. There was no way I was going to put myself into payments for that kind of a mortgage and for what?? A huge home that I wasn't going to spend a whole lot of time in.
The way I figure it is this... My home has a place to prop my pillow, a room for the kids and everyone pretty much gets shelter. Its not a cardboard box, but it doesn't have to be a 5000 sq ft mansion either. 3 bedrooms, 2 1/2 baths and a place to put the cars in a relatively (well really nice) neighborhood. Now come 6 years later and I'm living pretty comfortable with my payment arrangements and the house gets a few touch ups.
Now back to my point. Come July 2008, we are seeing in the news that Bush is asking congress to approve a multi billion dollar bailout for his cronies. Not for the people that were duped into signing for a mortgage that they never could have afforded to begin with. Granted, I will agree with you that 1/2 of this was the buyers fault. But you can't honestly tell me that the banks/lenders have some level of culpability in this from the start. They preyed upon the very nature that every family wants the dream home, so they fattened up the mortgages with balloons and variable rates and when the economy continues to go bust those variable rate mortgages went up as well. The banks knew this at the time they gave the loans. When a bank forecloses on a home, they just don't let the home go or call it a loss. They sell the home from its original owner for a pretty penny and get their money back.
Now lets think about this for a minute. The bank gives the lender a home on an interest only loan or one at a variable interest rate that the lender will probably have paid little to no principal in the last 4-8 years. Meanwhile the home is earning equity at a sizable amount. The buyer, with an every sinking economy, can't make good on the loan. As I stated the bank forecloses on the home, knowing in this economy the seller can't sell the home, and the bank gets the interest paid, the home itself and any equity on the home? The original owner is now out a home and ruined credit for at least the next 8-10 years.
I'm missing it?? Why are we bailing out the banks with billions of our tax dollars? Why aren't companies like Fannie Mae and other lenders not eating this one? Easy. Look who we have in office as our president and vice president. Follow the money.
BTW Fannie Mae's stock went up $2.50 on Friday. Go figure.
$4.00 a gallon for gas national average.
The way I figure it is this... My home has a place to prop my pillow, a room for the kids and everyone pretty much gets shelter. Its not a cardboard box, but it doesn't have to be a 5000 sq ft mansion either. 3 bedrooms, 2 1/2 baths and a place to put the cars in a relatively (well really nice) neighborhood. Now come 6 years later and I'm living pretty comfortable with my payment arrangements and the house gets a few touch ups.
Now back to my point. Come July 2008, we are seeing in the news that Bush is asking congress to approve a multi billion dollar bailout for his cronies. Not for the people that were duped into signing for a mortgage that they never could have afforded to begin with. Granted, I will agree with you that 1/2 of this was the buyers fault. But you can't honestly tell me that the banks/lenders have some level of culpability in this from the start. They preyed upon the very nature that every family wants the dream home, so they fattened up the mortgages with balloons and variable rates and when the economy continues to go bust those variable rate mortgages went up as well. The banks knew this at the time they gave the loans. When a bank forecloses on a home, they just don't let the home go or call it a loss. They sell the home from its original owner for a pretty penny and get their money back.
Now lets think about this for a minute. The bank gives the lender a home on an interest only loan or one at a variable interest rate that the lender will probably have paid little to no principal in the last 4-8 years. Meanwhile the home is earning equity at a sizable amount. The buyer, with an every sinking economy, can't make good on the loan. As I stated the bank forecloses on the home, knowing in this economy the seller can't sell the home, and the bank gets the interest paid, the home itself and any equity on the home? The original owner is now out a home and ruined credit for at least the next 8-10 years.
I'm missing it?? Why are we bailing out the banks with billions of our tax dollars? Why aren't companies like Fannie Mae and other lenders not eating this one? Easy. Look who we have in office as our president and vice president. Follow the money.
BTW Fannie Mae's stock went up $2.50 on Friday. Go figure.
$4.00 a gallon for gas national average.
posted by Jules at 7:12 PM
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