Wait a damn minute! Tonight on the television, I watched an eager couple at a government sponsored foreclosure loan seminar, or whatever they called it, working to get their home loan refinanced from a 7% loan to a 3% loan at a fixed rate. At the government's expense! WTF? A 3% loan? While all of us out here are paying anywhere from 5 to 8% on our loans and people are bitchin' about their loan being at 7% and the government is going to help them get 3% loans?
Something is patently wrong if this is anywhere near correct. Simply because people have loans on their homes and can't pay the mortgage is no reason to bail them out with taxpayers dollars. Sorry, but that's the cold, hard facts. People who overbought what they could afford, or who took "teaser" rates without having the brains to figure the rates would be headed up at certain time lines in the future, don't deserve to get special consideration for being stupid or greedy. There are exceptions, which I spelled out in earlier blog entries on this subject, so read those before you think I'm suggesting we throw crippled children out in the cold with the Alaskan bears to feed upon.
On the other side, IF the banks are being pushed to lower the interest rates, and the government isn't paying a cent toward the reduced interest rates, then why not go for the whole enchilada? Shouldn't everyone then be heading to their loan institution to plead their case and ask for a reduced loan rate? Especially the elderly and retired who live on a fixed income? How about disabled people and others who can't work, but make it by by scrimping and saving, yet somehow manage to get that mortgage payment in the mail every month, even if it means eating less or poorer quality meals? Reminds me of the lady who ate cat food because tuna was too expensive and she had to save somehow. Yet she didn't ask for a mortgage reduction.
Where does this end? Who is eligible for a mortgage reduction. If you don't pay your mortgage for a few months and plead poverty to the bank, can you get your mortgage reduced by hundreds of dollars? What about the people who are out of work and can't pay the mortgage no matter how low the interest rate goes. Won't they lose their home anyway? They are the ones I'd be more concerned about in this crisis, the ones who will be homeless or have to lose everything they worked for due to the housing crunch; those who should have had some relief from their lender long before it came to this.
If you read online, you'll see where the big banks want you to believe what a good job they're doing in helping out their customers working through the foreclosures. If that were true, you'd see many less foreclosure statistics on the maps and in front of homes, wouldn't you? While it's true that foreclosure is the last thing the banks and the homeowners want, unfortunately neither usually does anything substantive and positive about the situation until it's far too late. And, honestly, banks being what they are, are not all that people oriented. They're just bean-counters who want your money, and you're a faceless entity that forks it over every month. When the money stops, you cease to exist in their system.