| Mar 8, 2009 @ 12:53 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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DiamondRain
Posts: 6,459
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If this doesn't outrage you I don't know what will!
You know that neighborhood family who bought the new RV, or put that new pool in, or bought that new boat, or took that dream vacation you wish you could take?
Remember when you shook your head when you found out they did it by taking out a second mortgage or "home equity loan," on their house, and how you wish you could do that too, but wouldn't dare because you knew it was irresponsibly risky to mortgage your house to the hilt like that?
Remember thinking what a chump that guy was?
Well guess what? OBAMA HAS MADE YOU THE CHUMP INSTEAD.
Why? Because hidden in the fine print, and mostly unreported by the press, Obama's mortgage bailout includes a provision to EXTINGUISH SECOND MORTGAGES!
What does this mean? It means that guy who you thought was an irresponsible chump got the money AND DOESN'T HAVE TO PAY IT BACK.
In other words, thanks to Obama's giveaway, they got that RV, that pool, that boat, that vacation for FREE.
AND YOU WILL BE PAYING FOR IT!
Obama did say while he was campaigning that he was going to "spread the wealth around." Well, it's becoming pretty clear what he means now. He means he is going to spread YOUR WEALTH to SOMEBODY ELSE.
At least he is keeping ONE of his campaign promises.
Who's the chump now big boy? 
=============================
Wednesday, 4 Mar 2009
Second Liens Forgiven: Are You Kidding Me?
Posted By: Diana Olick
CNBC
Amid the dozens of pages of details of the Obama mortgage modification plan, one new element will likely not make it into the headlines because it’s something of an afterthought.
It has to do with second liens, that is piggy back loans or home equity lines of credit.
Deep deep in the pages of the plan, is paragraph vi. Second Liens: While eligibly loan modifications will not require any participation by second lien holders, the program will include additional incentives to extinguish second liens on loans modified under the program in order to reduce the overall indebtedness of the borrower and improve loan performance. Servicers will be eligible to receive compensation when they contact second lien holders and extinguish valid junior liens. Servicers will be reimbursed for the release according to the specified schedule, and will also receive an extra $250 for obtaining a release of a valid second lien.
So in an effort to help borrowers stay current on their newly modified loan, which is at a nice new 31% debt to income ratio, the government is also going to pay cash money to get servicers to totally wipe out second liens. When I heard this I thought there might have been something funky in my morning muffin.
It’s not that I don’t get the reasoning. Sure, do all you can to help people pay their mortgage, like get rid of other debt. By why stop there? What about car loans? Student loans?? The second liens, in general, were used by borrowers to either buy more home than they could really afford or to use their homes as ATM machines. Yes, some people use home equity lines of credit to pay college tuition.
But I can’t tell you how many homeowners I’ve interviewed (and just take a look at David Faber’s documentary House of Cards to see more) who took out home equity lines to put in a pool or buy a fancy car or put an addition on the house that includes a fancy new kitchen with a Viking six-burner. And I’m supposed to pay for all that?
It’s one thing to suck up the bitter pill in order to save the greater housing market and keep families in their homes, but using taxpayer dollars to give homeowners a free ride on second liens is preposterous. The Obama administration talks a good long line about helping “responsible borrowers.” Second liens can certainly be responsible, but there’s a much much much greyer area in these loans when it comes to actual “need”, and many many people used them irresponsibly.
In fact, if Americans hadn’t taken quite so much money out of their homes during the housing boom, we wouldn’t be in quite the underwater mess we’re in right now.
[Edited on 3/8/2009 1:16 AM]
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| Mar 8, 2009 @ 1:05 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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Brass_Wolf
Posts: 1,551
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Hey, it's change.
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| Mar 8, 2009 @ 1:13 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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If people hadn't borrowed so much money, people would have seen how much the economy had been screwed up by Bush & the Republicans. The economy would have been more flat-line throughout the "boom years."
Of course, DR will return all the money (above and beyond a steadily-declining baseline) he made during the "boom years," as he doesn't want to hypocritically benefit from the current financial crisis.
Right?
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| Mar 8, 2009 @ 1:19 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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| Mar 8, 2009 @ 1:33 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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What?
Oh, that's right. You're perfectly able to be a hypocrite, and see no double-standard in any of your actions.
I'm sorry, I forgot with whom I was dealing.
You claim to have been raking in the dough over the last few years. A lot of the money that was in the system at that time was from people who got that second or third mortgage to remodel and buy big toys. Some of it went to you.
You've had no problem taking the money out of the system, as long as it benefited you. Now that the "IOU" is coming due, you're claiming that you bear no responsibility?
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| Mar 8, 2009 @ 1:36 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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Are you off your medication again?
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| Mar 8, 2009 @ 1:41 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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Nope. Unlike you, my mind does not require medication to deal with reality.
Republicans spent years saying what a great thing it was, that people were able to borrow and borrow and borrow against their houses, because rising housing prices would cover up the deficit. (Kind of like the whole Republican mantra of "deficits don't matter anymore," huh...)
That money was propping up the economy. If not for that money, the crash would have happened back in Bush's first term. All that money you've been making over the last five or six years, quite a bit of it was attributable to people having the confidence to draw on their home's value, and having the confidence to spend in general.
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| Mar 8, 2009 @ 1:45 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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Nightowl001
Posts: 8,214
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But I can’t tell you how many homeowners I’ve interviewed (and just take a look at David Faber’s documentary House of Cards to see more) who took out home equity lines to put in a pool or buy a fancy car or put an addition on the house that includes a fancy new kitchen with a Viking six-burner. And I’m supposed to pay for all that? The wisdom of a home equity line for home improvements to increase the appraised value of your home, such as modernizing a bath or kitchen, or adding a room (or even a pool), depends on what the housing prices were doing in a particular area at the time the loan was taken out. It may actually, on paper, have increased the estimated future market value of the property so that it was "worth" more than the outstanding mortgage(s), and as such would have been seen as a smart move. This goes back to the concept that if you owe less on your house than it is worth, you're still in the black. The problem was when property values dropped (or when they were artificially inflated, I don't care which way you look at it), so that suddenly the market value was less than the amount owed on the property.
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| Mar 8, 2009 @ 1:47 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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DiamondRain
Posts: 6,459
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That is about the stupidest economic comment I have ever heard. (SNG)
Even if it had anything to do with the topic it wouldn't be worthy of a response.
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| Mar 8, 2009 @ 1:49 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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No the "problem" is that people made a contract, took risks, and lost.
And now they expect other people to pay for their lost bets.
No one guaranteed them their houses were going to increase in value.
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| Mar 8, 2009 @ 1:53 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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That is about the stupidest economic comment I have ever heard. (SNG)
Really? Wow. And I thought you liked to talk just to hear your own voice. I've heard MUCH stupider comments coming from you.
What part of it is mistaken? The economy was in a downturn. People borrowed money from their houses to buy stuff. That propped up the economy. That gave other people, who didn't borrow from their houses, the confidence to spend money. All that money floating around--some of it went into your pocket, money you rightly would not have gotten if people had put a lock on their wallets.
Or does money just magically appear in your bank account without anyone ever actually paying you?
It's really simple: if people spend money, you get paid; if people hoard their money, you don't get paid. Simple enough for a five-year-old to understand. (I was going to make it simple enough for a ten-year-old, but then I remembered with whom I am dealing...)
No the "problem" is that people made a contract, took risks, and lost.
And now they expect other people to pay for their lost bets.
So, they were behaving like a corporation then?
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| Mar 8, 2009 @ 1:58 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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SNG, why don't you just hang it up? The more you talk, the more you shoot yourself in the foot.
So, they were behaving like a corporation then?
You just conceded my point.
You think it is wrong for a corporation to do that, so then you also think it is wrong for an individual to do that. Which is exactly my point. Thanks for the endorsement. 
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| Mar 8, 2009 @ 3:00 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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My point is, you're a little late to be complaining about it. Were you telling people, "no, no, don't hire me for this job, the economy is artificially inflated, and it's all going to crash"?
No. You were out there to reap every cent from the system, as bad as you (just now?) say it was.
And so were the people who took out a second mortgage, with every expectation that the rising home prices would cover the cost.
They were stupid. You were just greedy. You knew better (so you claim), so where's your moral high ground? How are you different than some "welfare cheat," who knowingly milks the system, even though they know that it's unfair?
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| Mar 8, 2009 @ 3:04 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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SNG. You need some therapy.
You keep making personal statements and criticisms about me, yet you know absolutely nothing about my personal life.
Do you realize how foolish you look when you resort to the personal criticisms because you have nothing substantive to say about the issue?
Plus it is terribly boring.
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| Mar 8, 2009 @ 3:15 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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DR, I'm making a point here. I know it's hard for you to comprehend, but please, try to follow along. (Apparently, it's something that even a five-year-old can understand, but you can't. I'm sorry for not taking your lack of mental capacity into account.)
You can't have it both ways. You can't criticize Obama for ruining the economy, while holding the Republicans blameless. The economy would have collapsed during a Republican administration (well, more so than it did already) if not for the easy credit that Bush & the Republicans offered.
The trouble is, you DO want it both ways. You are perfectly capable of holding two contradictory beliefs, and being perfectly sincere in believing both, with the only difference being the political leanings of the people you are judging.
The economy would have collapsed a half decade ago. Deal with it. Call it 9-11, call it the "tech bubble," call it whatever. If the easy credit hadn't been offered, if Bush hadn't "passed the buck (and the bill)," we'd have seen desperate plans by the Republicans to prop up the economy. Plans probably much, much worse than these, as they'd be more "let's see if we can pauper the middle class and grind the poor into the dust, while enriching the upper class and bankrupting the government" than Obama's.
With the easy credit, people borrowed money like it was free. Industries stayed open, money circulated in the economy, and people felt confident enough to spend. But it was a band-aid.
You benefited from the "housing boom." So did I. I'm just seem to be more intellectually honest than you, as I'm willing to admit it.
**************
Edit: And surprise, surprise. Mr. "I can't post all the comments right now, but nine-out-of-ten of them agree with my position" has posted a blog. One that, if he holds true to his past positions, will show only fawning approval, and little of that.
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| Mar 8, 2009 @ 3:23 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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DiamondRain
Posts: 6,459
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With the easy credit, people borrowed money like it was free.
What you are missing is the concept of personal responsibility. This is the concept that all liberals are missing.
It is the fundamental building block of any stable economic system and without it, a nation cannot survive.
The fundamental issue is that just because credit is freely available, does not mean an individual should abuse it. And that is what some individuals did (but not the vast majority).
Now, Obama and the liberals in Congress are passing one law after another designed to reward the individuals who abused their credit and punish those who did not.
It's a typical bass-ackwards liberal response to an economic situation, and the reason the economy is getting worse instead of better.
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| Mar 8, 2009 @ 11:48 AM |
Your Neighbor Says THANKS! For The RV You Bought Them
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Gallows_Humor
Posts: 14,753
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I need more facts than the OP gave..
the obvious conclusion by DR.. was that the second trust deeds were going to be involuntarily forgiven and erased like they never happened..
I doubt his reality..
I'm thinking it will be more like.. ok 2nd trust deed holder..what do you want to do here.. your options are
1).. take over the house under a deed in lieu of foreclosure..
http://en.wikipedia.org/wiki/Deed_in_lieu_of_foreclosure
2) renegotiate the amount that you want to be paid for your note at a discount..
which will be paid by the new mortgage..
3) or quit claim any interest in this property...
and for that.. the servicer "will be eligible to receive compensation when they contact second lien holders and extinguish valid junior liens"
extinguish does not always mean..wipe out at no cost...
and DR if you are/were a mortgage broker... you were the cause of this...
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| Mar 8, 2009 @ 11:52 AM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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SweetNapaGuy
Posts: 9,100
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The average American wasn't the cause of the problem. But we certainly benefited from the "band-aid" of easy credit. Bush & co. pushed the collapse almost far enough to get it out of their reign. Almost... I appreciate the fact we had four or five years of more-or-less prosperity, but I recognize that it was bought at the expense of a larger crash.
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| Mar 8, 2009 @ 12:16 PM |
Your Neighbor Says THANKS! For The RV You Bought Them
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SweetNapaGuy
Posts: 9,100
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What you are missing is the concept of personal responsibility. This is the concept that all liberals are missing.
What YOU are missing is shared responsibility. All of us benefited from pushing off the crash by a half-decade. Where were you during the "easy credit" years? Raking in the money, money that would have dried up in an early crash? Or decrying the imminent crisis?
As is typical for you, you have no concept of personal responsibility. You are always trying to deflect any blame. You view yourself and your fellow right-wingers as paragons of virtue, and anyone who doesn't agree with you as despicable examples of vice.
If it weren't something so normally associated with sociopaths, it'd be sad.
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| Mar 8, 2009 @ 12:40 PM |
Your Neighbor Says THANKS! For The RV You Bought Them |
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Nightowl001
Posts: 8,214
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No the "problem" is that people made a contract, took risks, and lost.
And now they expect other people to pay for their lost bets.
No one guaranteed them their houses were going to increase in value. There were places in this country that property values dropped over 50%. No, no one guaranteed these people their houses were going to increase in value. But based on historical trends, they had every right to expect that they were going to. Mortgage brokers right and left were selling loans... "Yeah, it'll be tough to make the payments at first, but property never goes down in value over the long run. And wages just keep going up. Even if you're making minimum wage, your wages are going to go up, and that payment won't look so bad 5 years from now."
For most of the people on the losing end of these, this wasn't a matter of finding they had overbought and having to turn the house over on too little return, it was a loss of value in an investment that they had no idea or expectation was coming.
Walston is just the latest victim of a hemorrhaging housing market. Fueled in part by the mortgage woes of the world's big financial houses, for the first time since federal housing agencies began keeping statistics in 1950, the national median price for U.S. homes is expected to drop in the next several years. This was a historic event. This wasn't a "gamble" to most people. It was the soundest investment strategy available for the low-to-medium income earner.
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