Today, the U.S. Senate ran a test vote of legislation that’s designed to rescue home owners from foreclosure situations. The Senate voted 83-9 in favor of hurrying the new law that will have as its focus a foreclosure rescue program that provides $300 billion in cheaper mortgages for financially unqualified borrowers.
As always, follow the money. Where does the $300 billion come from?
If you are a U.S. taxpayer, it comes from you, my friend. What’s happening is that the U.S. government has decided that the hard work you put in to earn your money and pay your taxes is worth less than the political benefit that the Senators will receive for creating such a terrible bill. To them, your money and your effort is worthless, because they are throwing your good money in a pit of proven unreliability.
Chris Dodd, Democrat from Connecticut, offered this brainless endorsemement, saying that the legislation
“would allow us to begin to put a tourniquet on the hemorrhaging of foreclosures in this country.”
Chris Dodd is either an idiot, or simply evil – and I suspect the latter. I guess he forgets that a tourniquet frequently results in the amputation of a limb in an effort to save the whole body. But what is being amputated here? If you are a tax-paying U.S. citizen – your money is being thrown into a raging inferno of waste and irresponsibility. It’s financial amputation at its best.
This is shameful. You Senators who voted for this legislation should be ashamed of yourself. Where in the Constitution is there any legal authority for the U.S. government to bail out people because of their own financial weakness? I’ll make it easy for you: That authority doesn’t exist.
Not only is the Homeowner Rescue Bill bad policy, I think a very sound case can be made that it’s fully unconstitutional. Hopefully the President will veto it.
If you disagree with me on this, bring it on. I’m ready for a pleasant discussion 
Thanks, as always, for visiting FreeRealEstateTraining.com!
USA is a family and a large portion of this family needs help. One day you will find yourself in that situation and there will be no one to help you. At that point, you will understand what it feels like.
Hi Al – Thanks for your comment. Before I reply, I will say that I hope you are not facing this difficulty. If you are, you have my prayers, because it’s difficult. I know – I’ve been through foreclosure myself, all by myself, and didn’t seek the assistance of the government to deal with it. It was many years ago and the stinging pain still resounds in my mind. I did, however, seek help from my own family. And that’s where I differ with you: The USA is not a family. It’s a country, a political unit. It’s governed by law, and nowhere in our foundational law (the Constitution) is the government given the authority to do anything of this sort.
I do sympathize with the difficulty being faced by people going through foreclosure, because it’s a terrible circumstance. And if a member of my family or a personal friend was facing this circumstance and requested my help, I would be there. But that isn’t the job of the government of the United States. It’s just like a child who has a rich parent that always bails that child out of trouble: The child will never learn and will continue its poor decision making. I fear the same thing is happening here. And remember: I don’t say this heartlessly, because I went through foreclosure myself, and it effected me, my wife and my two very young children along with our entire extended family. I know what I’m talking about, and hope you’ll understand that the best kind of compassion is the kind that allows a person to be better prepared for the future, not the the kind that blindly solves an immediate problem and simultaneously sets up the next one. — Bryan Ellis
right on the money
Why can’t people just accept responsibility for their own actions, or in most peoples cases, inactions. They are the ones who bought houses way out of their price ranges, or had their nasty divorces, etc. Each person is responsible for his/her own situation, whether they believe that or not. You are where you are because you want to be there. If you don’t like your situation, change it. Deal with it. Only you can change you, because you want to change you and your situation.
With respect to everything but divorces, I agree with you. Sometimes that issue is beyond one’s own control. Still, the government has no role in resolving it, and that’s as it should be. — Bryan Ellis
Absolutely well written and I could not agree more.
I agree wholeheartily, hjistory has proven beyond doubt that any government efforts to distort the market have a 100% failure rate. In this case they are putting people into a liability situation, albeit subsidized from which the majority will no doubt fail, and worsen not improve the problem. But why should we be surprized I challenge you to find a senator with complete integrity, all to a lesser or greater degree put there own and special interests ahead of the national good. There is a need to provide some help in some areas, and some of the banks need a royal kick where it hurts, there are cases of the ARM interest rate moving up to exceed 10% – completely unjustified and if the bank wants another foreclosure on its hands then this is the perfect way to trigger such.
This country is not a democracy.
It was founded as a republic.
It was founded on the principles of
self-reliance,
self-governance and
self-responsibility.
Those people who turn to government for their needs will get neither security nor freedom.
Those people who have their hands out for freebies need to suck it up and take care
of themselves.
The less government intrusion in our lives
the better we can all maintain for ourselves.
The ignorance and apathy are to blame for
the state of our country.
STOP electing the same damn idiots into
office.
Buck Up, Americans.
Agreed, but one correction: We are a democratic republic, and neither a pure democracy nor a pure republic. I think it’s a very important distinction, but we can discuss that some other day
— Bryan Ellis
Men and women go to work, pay their bills, and maybe buy three or four cars over time.
After a few purchases they learn a little about the economic consequences of those actions. How many houses does the average family purchase? How much hindsight do they have before they make the decision to sign for the mortgage? How much do they know about a mortgage? Did you ever write one? I knew little about the topic when I bought my first and second house. I relied on those who spend every day in the real estate and mortgage industries to guide me. Didn’t you? If some crook in a bank sells me on the idea that I can afford a $600,000 mortgage because interest is at .00005 today, I figure he’s the expert, why shouldn’t I sign?
Let’s put the blame where it belongs, on the crooks in the banks, not on their victims.
That’s a really interesting approach to the issue. I do not deny that there could be culpability on the part of lenders who were willfully misleading, and the good news is that there are laws in place already that address that type of crime. (The FBI arrested over 300 people related to this recently.) But I differ with you on the notion that advice from a sales person (mortgage broker) should absolve anyone of their responsibility. It’s always been just a matter of being familiar with the paperwork you are signing, and knowing your own financial situation. If a person is incapable of having this understanding themselves, they should hire an independent financial advisor. — Bryan Ellis
Millions rushed to buy houses like “no money down and interest only payment”. Give me a break. This whole thing is a fairy tail. People are responsible for their none due diligence process actions before they jump into it. I’m talking about people who are adult and over the age of 30. Not some under age kids. If they don’t know what they’re doing, why did they jump into it? And why in the world should we “tax payers” bail them out. After all, where were we “tax payers” after they had everything going well for them? Now, all of the sudden, tax payers, please help. You made your bed, you lie in it. The comment above, “USA is a family”, then, why don’t call me so I can give you my bills to pay them for me? Hey you’re my cousin right? USA is a family in case of disasters. Yes. That I agree. FEMA, must help then. But, foreclosures bail out. No way Hoze. I hope I spelled it right. Idiots Senators.
I think Patrick sumed it up in one sentence,
“Stop electing the same damn idiots into office!” Let’s face it, if we are going to change anything about government and this country, it has to start with the elected officials. But then that’s hard to do when the majority of them make promises they don’t intend to keep. I say, “do your due dilligence when choosing a candidate just as you would when choosing a property.” Then we could all make more educated decisions on who to vote for.
Dear Bryan:
Regarding the Foreclosure bill, I would like to say the your comment about Mr. Chris Dodd is evil, should be extended to the other 82 Senators that voted for the bill.
I think there are better words to describe a person. Evil is a very strong word.
I don’t know how you described what the government did for the Mortgage bank that was bailed out and bought by Chase Bank at pennies on the dollar. And why has the CEO of Countrywide that walked out with millions when the company lost so much.
I love your training program,but this is just not in good taste.
I am not a Democart or Republican, I am an Indepndent.
Rudy
Who said anything about Democrats or Republicans? A person wins no favor with me by being “independent” or “moderate” – those terms generally means one either has no opinion or is not willing to stand for it. I’ll have to simply disagree with you regarding the use of the word “evil” being in poor taste. Poor taste would have been to sugar coat it and say that Chris Dodd is “merely misguided”. That’s not what I think, and I’ll not have it be said of me that being “politically correct” was more important than clearly communicating. So, I stand by my words: Dodd is evil. But I’m glad that you like my training program. There’s more to come! — Bryan Ellis
Chris Dodd does what he thinks will keep him in office and living a very cushy life courtesy of the taxpayers, not what is best for the country. A vote from a homeowner in foreclosure has just as much weight as a vote from anyone else.
In the end, Dodd’s self-serving actions by catering for votes from people not willing to take responsibility for their own actions pretty much makes him as evil, or at least unworthy of office. He is hardly misguided as he knows exactly what he is doing.
Politics as usual I’m afraid Mr. Ellis, Conservatism is dead at the highest level of our government, witness the two liberal losers we’ll have to choose from this November. These are the same senators that would cram Immigration reform down our throats and open the doors to millions of those family members of illegals here today. These are the same illegals that are taking over all of the jobs our citizens have held for centuries. I live in CT. where the imfamous Senator Dodd resides. This sleeze bag takes low interest gift loans from criminal Countrywide bank executives and there is no recourse. Your rights as citizen are fleeting my friend and when Barrack Hussien Obama or John Mcain are sworn in you better check your wallet. Both are in favor of Immigration reform, so we loose either way. All these people in foreclosure might have a fighting chance if they still had there jobs! And don’t tell me there doing the jobs we won’t do. I’m a builder turned RealEstate Investor. My fathers building business is going down the tubes because the Illegals are all in business and cutting his throat. It’s gonna get worse before it gets better but I’m voting for Bob Barr,Libertarian. It will probably spell the end for Mcain, but I’ll vote for Barr or I won’t vote!
Glad you have an opinion! I disagree with your choice but that doesn’t matter. Stick to your beliefs! — Bryan Ellis
Bryan:
Again, I have to say that you could be using
your intelligence in better ways than name
calling and character attacks.
Thanks again for your comments. I think we’ll just have to agree to disagree, as I can’t find an instance of character attacks anywhere on this website. But I’ll approve your post anyway. — Bryan Ellis
What gives? “Let he who has committed no sins…” my friend. Be careful, or you will
find yourself at the end of an “evil” comment
or two.
Also… again, you are making statements for
which you have no foundation. You are simply
getting into the mud puddle and getting all
wet yourself crawling into this fray.
If that’s true – why don’t you set the record straight? I’ll be happy to be shown the “error of my ways” if such is the case. But it’s not
— Bryan Ellis
Why don’t you do your homework and follow the
money… look for the cause, not the effects.
Your stirring up this issue as if the government
is really bailing out homeowners! Look closer,
and you will see the truth is much simpler…
this is another veiled handout to the BANKS
and to the LENDING INSTITUTIONS and is NOT
related in any way, shape, or form to the
citizens at all.
With as much education and intelligence as
you, at times, seem to possess… you would
be much better served to get your facts
before getting emotionally invested in
one or the other side of an argument Bryan.
This is where I cut out all of the stuff you posted about the Federal Reserve, the “fractional reserve system” and other such related topics. I’m very familiar with all of that, and prefer instead to focus on the real estate market. — Bryan Ellis
You’d be better served to stick to helping us
with real estate and not get political,
personally… although I do see your logic,
it has gotten me pissed enough to comment…
which I rarely do.
Thanks! Since every single post I’ve ever made here is directly related to real estate – sometimes including the legislative/political aspects of it – it appears that maybe you agree with the path I’ve chosen after all! — Bryan Ellis
It may also get me disgusted enough to quit
reading your info… something to think about.
While I have no intention whatsoever of changing the nature of this blog or anything on it, I hope and expect you’ll return. Why? Intelligent people have the benefit of discourse, which I encourage. That’s what’s happening here. — Bryan Ellis
Bryan, excellent piece. Just another attempt by the politicians to buy votes. The same people who like this bill because it “sounds good” are the same people that took out these bad loans to begin with. Good stuff. Keep making it plain!!
I agree that we need to learn by our mistakes. If the lenders want to offer assistance that is one thing, but our government should not bail them out. First they allow the mortgage industry to run wild and now they are bailing them out (their concern is not the consumer but the lenders)-tell me what is wrong with this picture. All this shows me is that our government is completely uneducated when it comes to our industry!!! We are in this mess because they did not do their job in the first place. Also, if you see gloom and doom in the future that is what it will be – we have the ability to see a bright future and the more of us that do that – then that is what will happen. It is a mindset and we have to set our minds on a positive and prosperous future.
With all these bail outs & give ways,
How Long Does USA Have?
About the time our original thirteen states adopted their new constitution in 1787, Alexander Tyler, a Scottish history professor at the University of Edinburgh, had this to say about the fall of the Athenian Republic some 2,000 years earlier: “A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover they can vote themselves generous gifts from the public treasury. From that moment on, the majority always vote for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse due to loose fiscal policy, which is always followed by a dictatorship.”
Thank you for the post Bryan. Here is another set of questions. Why is this a political situation? How did it move from the business sector?
The lenders can solve the entire issue with the stroke of a pen. They qualified the borrowers at the initial ARM rate didn’t they? Then change it to a fixed rate loan at that same rate. Payments will not jump past what the borrowers can afford. No (ok, fewer) defaults will occur. If they must have ARM loans then adjust at no more that the inflation rate with a lifetime cap. This is assuming that the lenders would not write a loan in the first place if they were not going to make a profit from day one. If that is not true then why did they write these loans? Their stockholders may well be asking that question today.
Problem solved. No need for an act of Congress. No polarizing debates on blogs. Or is this an overly simplistic answer?
Bryan, thank you for this platform.
Thank you for your comments! — Bryan Ellis
I think the problem here is that we’re confusing philanthropy with politics. Entering the political arena with issues especially in financial forbearance causes the many to be legally mandated to carry the few. Legislature should not be controlled by how we “feel”. As an investor, you already know this. How would you feel if your hand was forced to buy a property that you knew would bankrupt you because we all “felt bad” for the property owner. Isn’t one of the firs things that you learn as an investor is not to allow yourself to be emotionally tied to a property? Now, “philanthropically” speaking, we have the opportunity to help these people as friends and neighbors. I often encourage people to consider buying our short sales and offering them to people in their community at 80/20 but also on a personal level, to hold them accountable to credit counseling, retirement investment, tithe and otherwise fiscal responsibility. We are better equipped as a “community” to enforce this philanthropically than the government can monitor with eligibility requirements etc. which are far less personal. So in other words, we certainly want to be careful that we spend our responsible neighbors’ and friends’ tax dollars in a way that doesn’t reward fiscal irresponsibility across the board. We preserve those dollars so that they can spend them philanthropically which will always create a healthier economy. Give back. Give back. Give back…voluntarily!
Any bail out is absurd. I’ve not heard any media suggestions for people to look at their budgets and trim the fat. Do we NEED more than basic cable, satellite, and cell phones; fake nails; tanning bed time; someone else cutting the grass; someone else cleaning the house; delivered water; new cars every 2 years, etc? When does it stop? I have never lost a property but instead HAVE chosen to cut the fat out of my budget when life situations dictated it. It’s a personal choice for each debtor. My finances are the only finances I should have to care for.
I totally agree with Rex. Kick the Banks where it hurts one more time. I would like to know where all the money they made for the last 3-5 years on these Arms and other rip off loans went. Now they are crying wolf. An investigation will show they are hiding their profits and hoping to make more from the stupid government. Has anyone heard of a $25,000 dollar toilet seat?
I agree 100%. No bailout. It is just a slap in the face to all those who have acted in a responsible way.
Their was a program like this that started in the 1930′s as a temporary fix to help folks in the depression era which now stands as a thorn in our economy it is called welfare are we headed in the same path
We really must have the most corrupt government in the world. I’ll explain.
For 60 years, adjustable rate mortgages comprised of less than 5% of all the mortgages originated in any calender year.
After 9/11, the Fed, in their infinite wisdom, lowered short term rates to around 1% and held them there for over a year. That started the housing boom. Banks, Wall Street and brokers saw opportunity – they helped millions of people get into adjustables – a 1 yr treasury bill was trading for 1%!!… it made sense.
The subprimers saw opportunity to help homebuyers acquire over-valued properties by offering adjustables that were fixed for the 1st 2 or 3 years – giving homebuyers (and many refinancers) a false sense of security (Don’t worry, we’ll refi your loan before it starts to adjust). Ahem.
But here’s the kicker. By the time 2007 rolled around, nearly 40% of all homeowners had an adjustable rate mortgage (including heloc’s). Adjustable rates are all tied to short term interest rates such as the 1 yr. t-bill.
Now, with all those people in mortgages that will adjust based on what short term interest rates do, what does the Federal Reserve do? Oh, nothing much… they just KICK UP short term interest rates 4.25% over 17 months!!
Are they that stupid or is there some kind of master plan? I originally thought the plan may have been hatched in order to make the FHA a profitable government agency again (now that all the sub prime companies are out of the way).
But that wasn’t it my friend. NOW, I see what they were thinking… who do you think is going to distribute all this money?? Uhh, politicians? Right! Now if you put a small piece of $300 BILLION dollars into the hands of some politicians, do you think you may find some corruption? Want to bet that there will be an accounting scandal after all tis washes out? But do I think any politician will go down? Uhhh… no.
I must agree regretfully. My house is in forclosure and i havent made a payment in year. I am also getting ready to go bankrupt, but even through all this, I believe the fault lies with me. It was unfortunate that my construction and RE buisnesses failed a year apart and my 33 yr old wife had a stroke when my kids were 2, 2, and 5 yrs old and I didn’t have insurance. Yes, I could sit here and cry begging for help but I’m not.That’s what being a man is about. Suck it up. I made this mess for me and I don’t want the government’s help. Anyone in the same boat shouldn’t take the help either. Get out there and bust your a$$ and change your situation. It may take a while but the reward is that much sweeter. There are ways, the bank will work with you to help you sell, which I think we have a buyer, and if all goes well i wont have to claim bankruptcy either. That’s freedom. All the gov. will do is mess things up and tell us “well that’s why we have trillions of dollars in deficit”. So my message to big Gov. “FIX YOUR BUDGET BEFORE YOU TRY TO FIX MINE”
Peter: You have my respect. If I can do anything to assist you, please contact me directly and I’ll be happy to assist. Self reliance is profoundly admirable, and you’ll be in my prayers. — Bryan Ellis
Thank you Bryan for being the kind of guy you are. I’ve read every comment & appreciate your frank sincerity. I respect your ability to moderate the conversation appropriately so this is not just one long name calling session! I have been in a dry spell lately where no matter the blog, no one can see the meat of the issue clearly. Kudos to you!
Thank you for your very kind words – I really appreciate it! — Bryan Ellis
More than 1/3 of my monthly combined mortgage payment goes to property taxes. I’m tired of these Federal, State and Local politicians jamming more taxes down our throats every time they come up with the next great idea. I feel for people in foreclosure but in most cases, putting them back into the same situation (even with a lower payment) will most likely just lead them back to foreclosure again anyway!
greast thoughts
Any bailout is simply putting the penalty on the responsible citizens instead of putting the penalty on the irresponsible ones. Sounds backwards to me.
Did anyone notice the “tax and spend” party is trying to amend the bill with a new tax on internet sales. Some politicians are trying to tax us out of existence.
Oh…by the way, when I faced foreclosure many years ago, I got off my butt and solved the problem myself.
We have a, got to have it now, you owe me generation. How many of you have gone to a party in foreclosure & found if they got rid of the : cable TV, big screen HDTV, 2cell phones, new furniture to go with the new house, new lawn mower etc, etc, etc they wouldn’t be in the financial mess their in ??
Then there are the ones who really need help to save their home, I.E. lost job, health problems etc. that can’t get any help..???
The banks took the risk & profits of making bad loans let them take the hit for their gamble ..
Bryan,
I do not understand why the congress is willing to bail out these few to the cost of so many. Why don’t the senators pool their money together and help their fellowman. Oops-Sorry, their fellow person.If those that do not agree and want to shell some money out, I would be more than happy to take it in order to get my business off the ground. Of course, this is not fair because I would be benefiting from their generosity and not from a direct order from those who do not care about the little people (senators). The next time they, (congress) vote on a pay increase for themselves, let’s tell them that their pay raise went to help out the families of those hurting from the foreclosure crisis. I bet you dollars to donuts they will come up with some reason that they deserve this pay raise. That’s right-they need it to continue screwing this country over.
Bryan-
You’re absolutely right and the bailout crowd is just the typical big government liberal mindset, influenced by bombardment by today’s ultra-left mainstream media. They are the ones who have no idea of what it means to be an American:God fearing and wanting for self-reliance, personal responsibility, and a very limited central government. Thanks to the ultra-liberal, American-hating media and their bedfellow’s, the democrat party, our nation has unfortunately morphed into a socialist state where ever-growing government and confiscatory taxes are looked to as the solution for all our problems. No where is this in our constitution and it is anathema to what is America.
The problem is that 95% of mortgages ARE being paid without incidence. Of the remaining 5%, people have options such as selling or declaring bankruptcy, or foreclosing. I DO NOT want my taxes spent bailing out irresponsible home buyers across the board or the financial instiutions who should have been more discerning as to their lending practices. The solution? Let the government get the hell out of the way and let the private market take its course, i.e., let us investors do what we know how to do without one nickle of taxpayer money. This media created”crisis” too shall pass in favor of the next news story.
And for those of you who think something should be done, that’s called CHARITY, and is also a private sector vehicle beyond the scope of federal power as put forth in our constitution.
Whats New? Nothing! You all fail to realize that the US congress created the mess in the first place. They introduced a bill 12+ years ago that was the format as to how to make homeownership available to any one and everyone in the country. It was listed as a way for minorities to not be financially discrminated against. So now they are trying to rectify the problem by throwing MONEY at it, like usual. And Bryan, you of all people should know that MOST of the taxpayers money is wasted by the FEDS on a daily basis, so why get so rightous now?
If the FEDS can bail out the BANKS,WALL STREET and all their CONTRIBUTERS (oil companies)they can sure as hell help the average american in financial stress that they put them in. I think they should actually increase the bailout to 1 or 2 trillion dollars.
jhough
Hey Jim – great comments! I don’t agree with you at all concerning increasing the size of the bailout. I could give pretty good statistical evidence for my opinion, but I think the old axiom sums it up well: “two wrongs don’t make a right”. And I certainly agree – the feds are most adept at wasting money, but I don’t think all of the politicians are bad people. That’s why bringing these issues to the forefront can be of help to the future. Don’t give up hope, my friend. — Bryan Ellis
“Accountability”: An archaic term used by earlier generations of Americans. No longer politically correct. Soon to be removed from the dictionary as meaningless.
When a borrower enters into a contract, it is their responsibility to understand the terms before they sign,
and then to perform as agreed. You cannot close an ARM without signing pages of disclaimers, and the Note and the Deed of Trust or mortgage docs as well spell out when and how the rates will increase. Why is everyone pretending that the borrowers had no clue or were tricked into an ARM?
When a lender funds a loan, it is their responsibility to qualify the borrower before they lend out the the money.
If you are lending in the sub-prime market, you are accepting the risk. If you are buying sub-prime portfolios, you are accepting the risk. When you qualify the borrower for the biggest home they can barely afford at the introductory rate of the loan, because they can’t afford payments any larger, exactly what do you think is going to happen to that loan when the first rate increase comes around??
If either party elects to take a risk, it is their responsibility to accept the outcome and deal with it.
If any party involved broke any laws, or perpetrated a fraud, the damaged party has recourse via civil and/or criminal action. Not via a new government welfare program.
Neither the lenders nor the borrowers are entitled in any way to use their fellow citizens’ cash to bail them out of their situation, i.e., taxpayer’s funds being used to save them from their bad choices, lack of due diligence, or bad luck.
Save them from a natural disaster, a terrorist attack, Yes; From their own bad choices in their personal or business lives? No.
Is it a good thing to teach our children that we don’t have to worry about making bad choices in our lives, because the government will bail us out if we do?
And one might wonder who is going to bail out the government when those bailout loans default. I’m guessing it won’t be the members of the Senate that are pushing this through.
Well stated, Tommy. — Bryan Ellis
A lot of people got into loans because they were told by realestate agents they could afford them. My brother was told that, and fortunately he did not have enough for the down payment at the time, so did not get the loan. He soon lost his job, as silicon valley went bust here in california.
There is a certain aspect here that I think many of you are overlooking. Lots of these people got into the bad loans, because of bad advice given to them by persons in positions of trust, such as realestate agents, and financial advisers. Also if the government does not step in at least a bit, the situation seems like its going to continue to get worse, maybe even being like the great depression, and when it gets that bad, it becomes bad for everyone, no matter who is at fault. Yes, its their fault they listened to rotten advice, but the advice givers should have some responsibility in this too. I have heard that loan agents at the time were doing shady things just to make one more loan. They were not turning down applicants even though they knew they should. Its these areas that I do think needs to be addressed by the government, to help prevent a repeat. So I think its good that persons that do not have the ability to take on the loan be prevented by government regulations from getting the loan.
I fundamentally agree with you, except on one point: If a professional gets paid purely on the basis of what action you take, that person will act in their own self interest. That’s certainly true of mortgage brokers and real estate agents and frankly most everyone. So I don’t think it’s reasonable to give a pass to someone because their real estate agent or mortgage broker misguided them. But your other point concerning government regulation of mortgage brokers: The government decides to require licensing for mortgage brokering (in most states), and so it’s the government’s job to police their licensees. — Bryan Ellis
People were told that wages would go up, by the time the ballon payment was due, they could easily make the payments. Some of those loan officers lied, and others just did not know what they were talking about, but they stand in a position of trust, and responsibility, and should not be allowed to con persons into getting a loan, when its just going to mean financial disaster. Too many financial disasters around, and banks close, manufacturing stops, jobs disappear, everyone ends up getting hurt, except for the few that have some angle to profit from it all.
I have to take exception with that. The cold hard truth is this: The vast majority of the country is feeling no ill effects whatsoever from the real estate market weakness. None. That doesn’t mean that the market isn’t weak, it just means that unless you’re selling (or refinancing) into the weak market, it doesn’t really matter. So while the real estate market is weak, we’re a far cry from being in a Depression in which banks close and manufacturing stops. — Bryan Ellis
So…. if you are one of those people, making one of the most important financial decisions of your life… and you are gambling that your wages will go up before your ARM does (in an era where most people have no assurance they will still be employed at the end of the day)… and you didn’t get advice from a professional third party , and you believed lies from a loan officer… and blindly accepted whatever they told you… and you didn’t understand that their first order of business is making money from selling a service (getting you into a loan that you and the lender are going to pay them for)… and you think that they have a desire or responsibility to look out for your interests so you don’t have to….
…then, the government should bail you out?
Wrong.. …you messed up. Plain and simple. And now you want the government to take money from your neighbor’s pockets and bail you out, because you don’t want to be accountable for your decisions, bad choices and lack of judgement?
We have a responsibility to protect ourselves in life, especially when making major life decisions, by taking a few minutes to get informed about the pros and cons. Not real hard to do in this information age.
Here’s a clue: If it seems to good to be true…. IT ISN’T TRUE! You are about to lose something!
In the laws of Physics, for every action, there is an opposite and equal reaction; In life, for every decision, there are direct consequences. You can ignore or even deny these realities, but that will not stop them. Most folks learn these things as they are maturing. Some don’t, and later seem shocked and stunned when these things invariably catch up to them… and in denial, they go running to mommy or government to fix it for them. At the expense of the rest of the planet who have been responsible and prudent and successful.
Sorry. I’m all for helping those down on their luck or victims of circumstances beyond their control, but not those who refuse to be accountable for their self-inflicted problems.
Wow! It hurt me to read that, even though I agree with you! — Bryan Ellis
Bryan, are you hinting that I was a little blunt, LOL? Nothing else seems to work for some people.
Enjoying the thread, some of the responses are, uh, enlightening. Nice job of getting people looking at the issue
a little more thoughtfully.
Pretty much agree with your observations.
I applaud those who help clarify the situation. And really liked the Alexander Tyler, quote. But enough complaining, can we just put Senator John Kyl in charge as dictator?
I urge everyone to contact their officials by going to Congress.org. I just did.
Yes my name is really Bob Marley. Brian: Have you set down to do the math with the stupid “bipartisan” bill? How many homes in foreclosure? How far will $300,000,000,000.00 ACTUALLY go? Answer: not far. Keep up the good work.