Interesting post up over at The Liberty Papers: The Mortgage Bailout – Isn’t
In short no tax dollars are going anywhere so “bailout” is the wrong term.
Seems the lenders weren’t sure if they could modify the terms and still be kosher with the investors. However, now that the Federal government has said that they can modify the terms they’re going to do that.
The mortgage companies don’t want folks going into foreclosure right now because there’s no way they’ll recoup their costs trying to sell the homes on the current market. The buyers don’t want foreclosure either for obvious reasons. It looks like everybody is hoping that if they just keep playing along for 5 years with the interest rates pinned back to where they are now the market will catch up, buyers that can’t refinance will be able to sell without going upside down, the lenders are fine, and the investors will be a bit pissed that they didn’t make a great return, but they won’t have lost their shirts either.
Provided that this is actually a desired path by the lenders themselves I don’t see it as a disaster. If the lender wants to change the terms of the loan to be more acceptable for the buyer that seems like a perfectly acceptable “Free Market” solution. Whether or not the investors have a legal right to bitch about this is another matter, and that’s about the only thing the Feds are really meddling with it seems.
From what I recall, the lenders are all for it – “some” money is better than “no” money. Though I think this calls into question a larger “personal responsibility” issue. At some point, the population, in general, is going to have to “own up” to our own choices and not look to the government to solve our problems.
Our society is in trouble if there are no consequences to making bad decisions (i.e. a “gimmick” mortgage in order to finance a house 2x what you could normally afford).
Indeed.
Also, there is a double-standard. What about all the people that bought houses they could actually afford, but got a variable interest rate, which is resetting. They are left to pay higher rates, but the people who really extended themselves beyond what they should have, are getting a break. Kind of messed up if you think about it.
Fascism-shmacism. What’s the difference? Robbing investors via regulations is no different, in principle, than robbing taxpayers via bailout. Fascist on the one hand vs. Communism on the other hand – sounds to me like someone is getting a boot-heel to the face. Hasn’t anybody heard of National Socialism? There is a reason why the average status-quo Republican in power can’t be distinguished from the average status-quo Democrat in power – there isn’t a difference.
http://whoismittromney.name/