I can see the government helping people who were conned into these sub-prime mortgages by all those sleazy brokers. However, there will be those that were house flippers only looking to make a quick buck. Those people will be the first ones looking for a hand out..... they should NOT be helped! People have to take resposibility for their GREED and BAD decisions! Where was Bush when all the home owners affected by katrina neede help? He flew over and waived!!!

The government helps people when they're unemployed. The government helps people with their health care. The government helps college students pay for tuition. The government builds shelters for those without houses.

Why shouldn't the government help people with their mortgages?

It's all the same.

Why must we create a new social program which rewards poor financial planning? There is a huge different between predatory lending and subprime lets go after the REAL criminals.


I wrote about my frustration and would like to here your thoughts:

http://councilofnicea.blogspot.com/2007/08/busting-predatory-lending-myth.html

I have been struggling for the past year, I am a product of preditory lending, and i am searching for Help, A solution before i have to give up my home.

This is the most ridiculous proposal from our "fiscally conservative" government thus far... What will we be doing next? Why not bail out all that can't control their spending and max out their credit cards? The taxpayers should not be responsible for individuals' poor planning, living beyond means, and other poor financial decisions. We have more important issues to support!!!

The President has an "ask the president a question" web page at> http://www.whitehouse.gov/

This evening I asked this question on that page:

August 31, 2007 – My question: Regarding the sub-prime and the home financing mess, does the president see any way out of this predicament that won’t push residential housing prices significantly lower?

I am concerned about the policies President Bush mentioned in his speech today on homeownership / financing. The president’s speech didn’t mention or emphasize some issues which seem to be at the root of the more significant problems with single family residence financing and home ownership; particularly in the parts of the U.S which, over the last five-or-six years, have experienced the most rapid home price appreciation.

The abuses in mortgage lending practices, the abuses in residential appraisal practices and the general lack of disclosure and responsibility in ‘securitized’ mortgage portfolios has led to a crises which U.S. Federal Reserve Chairman, Ben Bernanke identified as the ‘principal-agent problem’ in his opening comments at the conference today in Jackson Hole, Wyoming. (1) It seems full-disclosure and solutions to ‘the principal-agent problem’ must be mandated before the residential mortgage market will be sound.

Consider the extreme: A significant supply of the residential housing in the Southwestern United States has become unaffordable (for the average family)(2) because cheap and easy financing has “pushed” successive rounds of home price increases. As some people began to believe myth of never-ending home price increases they increased demand for homes by speculating on the myth. Some pyramided their home equity by trading-up and some used home equity loans to buy other homes in the hope of capitalizing on further price increases. (And some used the loans to make down payments on expensive automobiles which increased their debt servicing obligations). These activities raised demand for housing and pushed prices higher. (Also noteworthy: many speculators claim, on each mortgage application, that the homes they buy will be ‘owner occupied’ and mortgage originators make little effort to verify the claim (again the ‘principal-agent problem’).

Also, another recent phenomenon - particularly in the Southwestern U.S. - this other phenomenon is “group-homes”. As the housing market seemed to become un-affordable for traditional families groups of people began to form partnerships to buy houses with the agreement they would live together and share the profits when the house was sold. In general the borrower claims the home is an “owner occupied” single family residence, so this is mortgage fraud. In most cases it’s also a violation of local zoning laws and local health laws. In most cases the participants in these arrangements have very modest means, and little or no formal education.

It seems that restoring integrity to the home financing market and insuring more durable participation in the American Dream of Homeownership will require a reversal of many of the abuses of the last seven years, or so. It also seems that a reversal of past abuses will significantly reduce the price of residential housing (supply and demand).

I don’t see any way out of this predicament which does not impact housing prices significantly. Does the president?

(1) The principal-agent problem – see > http://en.wikipedia.org/wiki/Principal-agent_problem
Also, see Federal Reserve Chairman Ben Bernanke’s opening comments at the annual Federal Reserve Conference in Jackson Hole, Wyoming – August 31, 2007
> http://www.federalreserve.gov/boarddocs/speeches/2007/20070831/default.htm

(2) A little basic math may be in order. I recently read that the average home price in Lost Angeles in July was $517,000.00. I then researched the average annual family income in Lost Angeles and found that it is about $48,000. The current annual mortgage payment on $517,000.00 is $35,004.00 before property taxes. This leaves the average family in Lost Angeles $12,996.00 annually to pay for all other family household expenses [e.g. property taxes, income taxes, utilities, food, health care, clothing, education, travel, entertainment, cell-phone, and tattoo & piercing, and transportation expenses- like auto loans, fuel, auto registration, maintenance and repair. That's $1,083 per month (or $36.00 a day) for all family expenses above the cost of the mortgage!

--------------
For general background reading you may want to reference hearing testimony from The U. S. Senate Sub-committee on Banking, Housing, and Urban Affairs from June 26, 2007 titled, “Ending Mortgage Abuse: Safeguarding Homebuyers” http://www.banking.senate.gov/index.cfm?FuseAction=Hearings.Home

My wife and I are also victims of sleazy lenders and for the past 1 1/2 years have been looking for alterntives to a very high mortgage payment; what does Pres. Bush have in place for those of us who are not 90 days past due but are borrowing just to make the monthly house payment (with family's help), who I might add, work full-time jobs as well as additional work just to make ends meet? There are people who need help immediately and not just people who are 90 days late on their mortgage payment! if Pres. Bush only helps people who are late, he needs to be fair and help decent, hard working people who are struggling due to no fault of their own. Thanks, from a concerned and struggling American citizen

hey can the FED pay me back for the loss I took in the stock market?
If so I think I will try my luck again.
What do I have to lose.
And if not, why?

Isn't it true that "Decider's" "plan" to "help" subprime borrowers by waiving the FHA 3 percent down payment and permitting mortgage loans in excess of 100 percent of the valuation of the underlying property, in a RE market just beginning a downward price correction that may be unprecedented in it's duration and depth, results in the following:

1.) The current lender, stuck with a devalued property in a pre-foreclosure status, receives a total, taxpayer subsidized bail out, if the FHA provides bagholder refinancing in excess of 100 percent of valuation...

2.) The bagholder who signed on to a sub-prime loan because RE prices can "only go up", to buy a property worth less now than he paid, will be "rescued" by a new loan that has him owing more than his residence is worth, with more decline to come. Doesn't this turn him into a debt slave, instead of, in the predicted course....escaping via a short sale that sees him walking away with the same tarnished credit he will have, (he's missed 3 mortgage payments....) along with his new, upside down FHA loan?

3.) Doesn't this "plan" simply transfer wealth from the US taxpayer, the bagholder, and because of this, the weakened FHA.... to the sub-prime lender?

Isn't this outcome the true intent of "Decider", and his pigmen sponsors?

Figures always giving to those who dont know how to manage their finances. I wish I would get money for being smart enough to get a fixed rate and always paying on time!

Look...do not be fooled by government "compassion"...follow the trail of money...it's the loan holders that are pressuring Bush, knowing that if 80,000+ homeowners default, they will be left footing the bill!!! This is about Bush helping the companies that hold the loans, not the "poor consumers"

Let's see I will give you a loan for $500,000.00 and you only make $35,000..00 a year. Then IT will be adjustable. 1-5 % in the first few years than it can go UPnUPnUP. Gee maybe the banks that gave these loans should eat their lossess. Not the Goverment. The bank's and the GREEDY mortgage broker's that pushed these bad loans on people that should have never been approved for in the first place. GREED is the motivation for this problem, and I the TAX PAYER should not have to pay for it. I make my payments on time and they are fixed. If I need help were do I go ? Oh I know deeper in debt, will the Gov't help me the responsible person ? Where were the checks while this was going on ? Well look's like the barn door was lefted open again. Larry NY

This is who our Gov is going to bail out. Financial corp mortgage brokers and CEO's that made millions. Who may not only have sold bad loans to people who could not afford them, but also the flippers out to turn over a fast buck. The financial corp. that made the money should be the ones to put it back and balance this mess.

Insider Actions for Countrywide Financial Corp
08/13/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 46,000 Exercise of Stock Options
at cost of $675,740.00 chart

08/13/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 46,000 Open Market Sale
proceeds of $1,306,400.00 chart

08/08/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 92,000 Exercise of Stock Options
at cost of $1,351,480.00 chart

08/08/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 92,000 Open Market Sale
proceeds of $2,644,080.00 chart

08/07/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 110,000 Exercise of Stock Options
at cost of $1,093,400.00 chart

08/07/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 110,000 Open Market Sale
proceeds of $3,086,600.00 chart
08/01/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 30,000 Exercise of Stock Options
at cost of $298,200.00 chart

08/01/2007 ANGELO R MOZILO
Chairman & Chief Executive Officer 30,000 Open Market Sale
proceeds of $844,800.00 chart

07/19/2007 DAVID SAMBOL
President & Chief Operating Officer 4,250 Exercise of Stock Options
at cost of $56,270.00 chart

07/19/2007 DAVID SAMBOL
President & Chief Operating Officer 4,250 Open Market Sale
proceeds of $149,855.00 chart

Homeowners have been taking the equity out of their homes for the last few years to buy cars, go on vacations, buying second homes, and just spending like it was free money. Consumer spending has made the economy look strong for years, but now things are changing and homeowners are negative in regards to their home's equity. Homeowners should not be bailed out for making bad decisions and lenders should not be bailed out for lending to risky borrowers!

You are a bunch of whiners. I recently moved as my monthly mortgage payment got too big to handle. Why you may ask? ARM? NO, Subprime "victim(lol)", NO.

It was because of the high taxes/insurance rates we are being forced to pay, my monthly escrow increased about $750/month in three years! I was paying $2500/ a month after buying the place three years ago for $1800 a month.

How about President Bush giving me money to buy my house back. Using the logic seen blogged here, it is just as idiodic to make such a request. You dumba$$$es shouldn't have overbought regardless of what your lender was willing to loan you. I didn't have an ARM or subprime loan and I got screwed. That will happen more if the Government continues to dole out other people's money.

How about some personal responsibility for a change? The U.S. Government isn't you mommy!

There are some of us who lost our butts because we lost our JOBS!!!! My state has been hit particularly hard. The problem is our economy. If I take a minimum wage job, I will be -2 dollars per hour, after I pay a sitter. We all want to pay our debts, but what are you supposed to do when there are no decent jobs? We also tried to sell our house, because we were trying to be "good planners", but the housing market is so poor, we couldn't sell for the price we owed. It would have cost us 10,000 to sell our house . Bush doesn't care about home owners-he only cares about the rich banks that quit getting their payments, decreasing the lining in his cronie's pockets, like every other decision he has made while in office.

I have always prided myself in keepin my bills and housing in line before anything else. But this has become ridiculous, in that someone somewhere is getting richer by the minute, while the working class suffers tremendously. I am about to cash in my 401k just to cover my basic expenses. This is very sad.

The thing that least impresses me is the fact that we as a country make it so difficult for someone to even be sick (thanks Bill Clinton for the FAMILY LEAVE ACT)
I work for a multi billon dollar company and yet when i am unable to work due to medical problems that arise, my employer still makes its employees get an approval for being out from the doctors with the fmla forms...then get the forms as proof..and send them to the administrator and still not get paid. Now tell me what is wrong with this system. I urge each and everyone of you that has the same or similar circumstances to raise more awareness of this growing problem and stop taking away from honest people who would be working if not for sickness...what an awful United States we have become

From reading the postings it sounds to me that people are finally getting angry and tired of being ripped off. I say it's about time. Those of you who are sitting out there and putting people down for making poor financial decisions obviously have never been divorced, had a family death or crisis, lost a job,work for minimum wage or any of the millions of other reasons that american people have gone through. I say count you blessings each day. But for the rest of us who have experienced any of or all of the above then yes we need help. This mortgage business is absolutely ridiculous. There is not anyway that even the most intelligent humans on earth can figure out or get a straight answer from these theives. One wants to buy a home. You put yourself out there like an open book. Most of us are honest hard working people who truly just want to have a home, a car, food on the table. Then the process starts. Well we need to pull credit. Never mind we do our homework and pull our own before we even get started. Even so now we see the score we got after paying the big three for them is sometimes as 100 points lower than what your lender or broker gets. Now they have you set up for the subprime game. Oh you can't qualify for 5% or 6% but I can get you 8.5 on an adjustable. That's how quick it happens. But in the meantime before they give you that horrible news you are told we have to order and appraisal. Whoops thats 350 dollars at minimum and we all know that appraisers are so afraid they won't get paid so you must pay for it when they come to the door. Then the next hit, even though this person had been hired by the lender as an approved appraiser not the lender so oh no, I don't believe you appraised this property correctly. I will have to complete a desk review. By the way the desk review is no more than the lender calling a real estate agent and asking them to do a drive by. So now you wait for this. It comes in and the value is 200,000. less than the one you paid for. Whoops I already have a mortage for more than this idiot says my property is worth. Who committed the fraud? The person who appraised it the first time or the bank who lended me the money and now that I can't pay for it will foreclose on me and sell it on the open market for less than what I owe. Which gets me to my main point. I feel the reason they can do this is one thing. Have you ever really looked at what you are paying for your home. Put of an 1812.00 mortgage each month (not including taxes and insurance) look at what goes to interest and what goes to principle. $1671.31 to interest and a measly 141.20 to the principle. Wow how I would love to be receiving 1700.00 a month interest on my savings account. That comes to 20055.72 per year. Muliply that by 11.5 years and you have paid back every penny of the principle loan amount. Now lets keep paying them for another 18.5 years that same 1700.00. I think you smart people out there get what I am saying. At the end of that 30 year mortgage if I keep it that long and don't die from trying you think the bank would buy it back from me for just what I have invested in it? I say not. It is time that the government steps in and stops loan sharks in their tracks. Completly abolish credit reporting agencies who couldn't get their information straight if it were written down for them(as we all have done at some point and time)You see banks are federally backed and loans are guaranteed to a certain amount. They get back a percentage of all loans, you've paid them 20000 or more per year for the 5-7 you own it, they take your house and give you absolutely nothing for all the months that you paid them faithfully but some nut case on the phone once you get behind acting like they are God. Anyway this is where I believe it all goes wrong. American dream? How on minimum wage or during a recession, or loss of job or any other situation that people find themselves in a bad financial way. I appreciate the opportunity to blow off steam on this site and yes I am one of those ""Victims" and on top of it I am a self employed individual who now finds myself not being able to refinance because I am self employed and do write off as much as I possibly can each year at tax time and can't document income of 300000 per year. Hope all of you find yourselves surviving and hopefully keeping you homes..