Why should my tax dollars bail them out? They made bad decisions, not me.

This is great News!

I can buy the new 2009 Suburban I have been dreaming about.

Now I can forego my house payment - the money will be taken from those who've earned it - and given to people (like me) who 'can't make my house payment'.

Liberal giveaways ROCK!

But bailing out the lenders who also made poor decisions to provide mortgages to people with poorer credit or to approve them for zero-down ARMs is just peachy?

This is arresting all the users yet allowing the dealers to remain at large.

This is important. The banks aren't going to be able to recoup their investments without a program like this. I guess it's "liberal" to try to help people, but "conservative" to only bail out the banks.

Why should my tax dollars have to go to bail out fools who took out ARM loans figuring during their 15/20/30 year mortgage (or even thought about it happening at all?) that interest rates would never rise? I did take Accounting 101 in college but eve I knew that a variable rate loan means just that -- the amount needed to be paid each month could "vary" - DUH!.

Anybody want to throw some free mortgage bail out money with no strings attached my way? Whoa, I forgot. I wouldn't qualify because I was too responsible and took out a fixed loan based on what I could afford to pay. My bad.

Whoops - left out one very important word in my post above --

... I did not take Accounting 101 in college but even I knew....

HOw can we responsible borrowers get in on help with our mortgages?

What part of sub-prime do these lenders not understand.

Yeah I took a 7yr balloon. I paid it off after 7 years, Or I would have switched to a 30 year.
Those types of mortgages are good for medium term price speculation. Not long term ownership.

I am up for raising the bankruptcy protection for the home owners (maybe freeze the balloon payments), but the lenders have no excuse. They do this for a living. They should know what someone can afford (statistically). If they broke what used to be their sensible rules, they deserve to get burned.

BUSH THREATENS VETO: Says it won't help struggling homeowners

The White House said the legislation would force the government to take undue financial risk.

Hey Compassionate Conservative ! That is a scream... how's about the 10 billion per day in Iraq ?

On NPR they were interviewing a guy who over extended himself on a sub-prime mortgage. He stated that the loan officer told him the interest rate on his ARM would never go up.

This guy should loose his house for the sole reason of being so stupid or probably more like "ignoring reality". Fortunately for him the bank renegotiated his loan.

Bailing out stupid people and greedy bankers is a bad idea. Give them a hand up but make them pay back every cent with interest. That way they will think twice before gambling with other peoples money.

Mr. Bush can't sign that veto fast enough

It is interesting that these peoples interest rates have gone up so drastically while the real interest rate has remained low.

One can easily make a case that these financial banks and companies created the problem themselves through their greed, and yet people still feel the need to protect the finance companies.

Patriotism at its finest.

Welcome to the America of the elite, trounce on the guy at the bottom for making a bad decision and protect the financial elite rich for making a bad decision.

Bailing out Bear Stearns helps the American taxpayer; bailing out Americans who will lose their homes because of what Bear Stearns and others like them did hurts the American taxpayer.

The doctrinaire Right(in opposite world, as always).

This is a crock of shit and I'll veto this if it comes to my desk. What is Pelosi and Reid thinking? These are just Americans, we can't be bailing out anything except my corporate donors, err friends, err cronies. Umm, 9/11, Bin Laden, 9/11, Al quaeda, WMD, WMD, WMD!

Sincerely,

George W. Bush

Yep, let's subsidize greed and stupidity...It'll expand our base.....

Sincerely,

Dems

From Jon Kryer's comment it becomes clearly apparent that we need a constitutional amendment making it illegal for conservatives and Republicans to use the word "Compassion" in any context other than a theoretical exercise.

If I lived down the street from one of these people who are in jeopardy of losing their home in a foreclosure then federal assistance to help them refinance at a reasonable interest rate would actually end up helping he because the value of my home would not drop as much. It isn't as if Congress was proposing to pay off these people's homes for them and it isn't as if a program to allow refinancing of these mortgages would even end up costing taxpayers anything. The people would still have to pay off their own mortgages, the homes would still exist as collateral for the loans.
I think righties believe that compassion is a weakness.

For those complaining about the Bear Stearns bailout--think about this: Bear Stearns had over 14 TRILLION dollars in derivative contracts. Yes, Trillion with a "T". If Bear Stearns went down, it is hard to fathom what that would do to our markets worldwide. The only thing the financial gurus knew was that it would make the housing bubble look harmless. It would be an economic catastrophe on a global scale.


That being said, i think there should be something done to protect against these impending foreclosures. It too will continue to have a devistating effect on our overall economy and wipe away lots of wealth for middle and lower income folks. I'd rather see forced mediation/arbitration between banks and borrowers during the foreclosure process. I'd like to see a tax credit for those buying foreclosure properties (or buying from investors who fixed up destroyed foreclosure properties). I'd like to see a freeze in interest rates under SOME circumstances (good credit, on time payments, etc.) There are ways to make this better--and not all of them cost the taxpayers money.

Who is more greedy and stupid? Supposedly financially literate corporations with billions of dollars and what that buys at their disposal and 500 years of experience of lending practices to draw on or John Doe with none or little of that.

Only somebody like Bush and his supporters whose minds and attitudes were made up long ago and have now frozen into doctrinaire inflexibility would say it's John Doe.

There are always about 5-10% of people who will take the opposite side of any argument just because that's the way they are. There's 28%(of those who vote) who still support Bush. So what's with this other 18-23%? Faith, drugs?

BlueinBushland,

So, how is it that people who buy houses they can't afford and companies who write loans to people they know can't afford it aren't being greedy? Why should the homeowners or the banks be rewarded for their greed?

"Why should the homeowners or the banks be rewarded for their greed?"

Some righties are always so worried that someone will get something that they don't get. Life isn't always exactly fair Jon, get used to it. The overall economy would be better served by helping prevent foreclosures and helping families stay in their homes even if the people did sign mortgages that weren't very sensible. They will still pay for their houses, it won't cost you a dime so really why do you even care???

SO let me guess this straight Danni. The economy would be better served by letting people who bought a mortgage they can't afford to not meet the Debt obligations. I never knew that stupidity if a valid excuse in business law.

I saw let they houses go to foreclosure and they can moved to a homeless shelter

Danni,

You're right. The world isn't fair, so why are you taking my tax money to try to even things out for greedy people?

No they won't pay for their houses. They never could. I will pay for their house. I will also pay to prop up the stupid, greedy bank who wrote the loan. This will, in turn, encourage more such behavior which I will again have to pay for. No, it is theft, and it is unsupportable....Those responsible need to be punished by the market....

This is a perfect example of the mean spiritedness of some righties. This will cost them virtually nothing and will probably help prevent them from losing equity value on their own homes yet they oppose it simply because they want to punish some poor slob who was duped into a bad mortgage.
I've know stubborn children who had that mindset but I always thought most adults grew out of that selfish stage of development. Obviously many on the right haven't.

Bernanke worked all weekend to save the rich. But saving the middle class???? That discussion will never end. It just doesn't fit the elites agenda.

"The Congressional Budget Office estimates the bill could help 500,000 homeowners at a cost of $1.7 billion through 2013."

So this will cost me a dime.

but...

I consider myself a moderate, socially more lib, financially more conservative...usually those two together adds up to keeping the gov't out of my life, and hopefully out of others.

key word there, normally. It's sorta like 'Standard Operating Procedures' what are the procedures for Non-Standard Times?

I'd view this as a non-standard time, and my standard views will most likely not apply.

This problem is too big, and it's effects to far reaching for all those involved to 'learn their lesson', but it shouldn't have to come all from the taxpayers, both for Bear Sterns and the Homeowners.

time for wild speculation as this is not my deepest area of knowledge, but it would seem that since Sterns was bailed out, and is in a position to do business, that there should be a way for them to refi the loans for these folks in a fashion where they don't profit, and lendee's don't end up with a better deal on their fixed 30 than I got by being responsible and staying in my home and a mortgage I could afford, and not trading up 'because I could'.

Danni,

Even children know that stealing is wrong. It's adults that often forget.

Nutcase,

Middle-class people shouldn't buy houses they can't afford. Banks shouldn't lend them enough money to do so. The system is self-correcting. This won't happen again, unless the government props us and rewards those responsible..

KWRX25,

The incorrect presumption here, I think is that these poor homeowners are losing their homes. No they are not. They had no equity. They borrowed so much that the house payments they did make were largely covering interest. They essentially got very large, cheap apartments and now, since they couldn't pay the rent, and that's really what it was, then they get evicted. No big deal. They're out very little.

It's the banks that lose money here, and they should. They made risky loans they simply wouldn't have made in the past. They knew this. They just thought they'd get away with it. Let them feel it....They'll remember not to do it next time. In the mean time, those greedy families can go rent apartments. A little smaller, maybe, but that's what they were doing anyway. The market will settle this business just fine, unless the stupid government buts in and ruins things.

"Danni,

Even children know that stealing is wrong. It's adults that often forget."

Well Republican adults, especially Bush cronys do forget but surprisingly, Jon Ryker's comments are virtually irrelevant to the subject at hand.
Refinancing a mortgage to a lower interest rate is now called "stealing?"

12 Billion a month in Iraq
1.5 Billion to help 500,000 Americans stay in their homes and prevent all of our homes from losing value.
Which investment will benefit Americans more???

Danni,

If I'm paying for someone else's house and I don't want to, yep, that's stealing. Even a grade school child would readily see this as such. It takes time to make people that stupid, and in gradeschool, the public school system hasn't had enough time to complete it's dumbing-down, Democratizion operation yet. So yes, that's relevant, unless you're too dim to see it.

The 12 billion in Iraq will benefit us more than 1.5 Billion to underwrite theivish behavior. They're not poor, innocent victims. They are greedy bastards. They have nothing invested in their house...why should I invest in it?

Its a catch-22. Help em and you set the expectation that Unclescam will bail you out if you fuck up. Don't help em and it could seriously fuck with the chi of our already fucked up economy.

What is the answer? I think ya gotta go with tough love here. Most of the people in trouble have little or no equity in their homes so they walk away, move into apartments or rent houses and 7-10 years from now they can try again hopefully wiser.

This is a perfect example of the mean spiritedness of some righties. This will cost them virtually nothing and will probably help prevent them from losing equity value on their own homes yet they oppose it simply because they want to punish some poor slob who was duped into a bad mortgage.
I've know stubborn children who had that mindset but I always thought most adults grew out of that selfish stage of development. Obviously many on the right haven't.

Posted by danni at 2008-05-09 10:25 AM | Reply | Flag: Flag: (Choose)
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Good point, Danni. Whether they're just mean-spirited or simply being myopic in their doctrinal "purity" could be debated, but this mess affects all of us. If millions of homeowners can't make ends meet, a lot of neighborhoods are going to go to the dogs, and that affects even those who so smugly think they're immune. Combine the housing debacle with high fuel prices, a declining dollar, and an overall sinking economy, and pretty soon we're all swimming in shit.

I don't want to bail out dumbass borrowers either, and I sure as hell don't want to bail out dumbass lenders, but we need to look at the big picture. I admit I don't know the answer, but you guys on the right don't either. "Let the market decide" can be a painful mantra.

Then again, we on the left are all elitists...

How about this for a bailout. Refund the closing costs to these dumb bastards who bought a house they could not afford and let the house go to foreclosure so someone who can afford the house can buy it. The majority of homeowners with adjusted rate mortgages put down the minimum and have been paying off interest and little or no principal.

"Hey Compassionate Conservative ! That is a scream... how's about the 10 billion per day in Iraq ?"

$18,250,000,000,000.00? That would be $18.25 trillion. You should stop getting your numbers from Daily KOS. Perhaps you should show some compassion yourself for forcing people to read the ridiculous garbage that comes out of your mouth.

Are you a homeowner TIMBCI? If you are, then you most certainly want your neighbors to avoid forclosures, as that will most assuredly have more of an effect on your home's value. 1.3 billion over five years...less than a week in Iraq, to help lots of Americans remain in their homes. I guess it's much better to spend that money on the Iraqis...well, on the contractors who aren't completing their work. You'll be hit a lot harder in the wallet, as a homeowner, by the forclosures than by the aid program.

Ryker,

"This won't happen again"?

What the fuck are you talking about, the Great Depression, S&L Fraud, Enron Fraud... or how about Wall Street and Investment Banks laundering Narco Money? Its a long fucking list with Government looking the other way for the superrich and always fucking over the middle class. Bear-Stearn promoted a Ponzi Scheme. There should be no bailout without adjunct prosecution for fraud.

Unfortunately, the standards of proof required for the rich are higher than for the average schmuck. As far as I know, Charles Keating was the only one prosecuted during the S&L disaster, out of hundreds of Royal Scams. He served two years. At least $400 billion dissappeared into the hands of CEOs and mafioso figures. YOUR MONEY. They loaned themselves money with fake appraisals, which they never made a single payment on. BushI made sure they weren't prosecuted by firing 50 Fedral Prosecutors the Saturday after he was elected. Neil Bush was grateful.

CBOB if you think it will hurt neighborhoods (which I agree it will) think what a few foreclosures will do to a conodominium. Banks don't usually pay the maintenance fees on units they forclose on so either the remaining residents pay more or the whole place turns to shit. I've seen it happen and it really is horrible for the residents who remain there.

JonR

I'll agree with you there...if someone came along...put nothing down...got a nice 3 year arm around 3-4% and are now not able to afford it...then you are right, they basically paid rent and shouldn't be bailed out.

I was viewing it from my perspective...I could have sold my house, bought a bigger one (which I need as the family has grown) and now be looking at loosing a house AND all the equity I'd brought into it with a fat down payment.

as with all issues there are complexities...would seem that there should at least be some criteria to meet before aid is given. As the two above examples show, some people would be losing everything and some people would have basically had cheap rent in a nice house for a few years. There's a difference there.

Any country that can waste 500 billion dollars in a war for oil, that misplaces 8 billion and can't account for it, that has oil companies earning the largest profit of any corporation in the history of the world....can afford a measly 1.5 B to bail out 500,000 home owners.

I just got sexually molested at the gas pump...please tell me how this is war for oil? not saying it isn't but I could use a review.

Yes Evash. I am a homeowner. I am a responsible real estate investor. I purchased my property for $300,000 and put $140,000 down and yes I have a fixed mortgage. If any of my neighbors lost their place due to foreclosure I would buy it before it hit the market. I wouldn't last a week. When I bought my place last year it was on the market for two weeks.

Any sort of deal they offer these fool that bought houses they couldn't afford should ban them from owning any property for 10 years or a brain transplant

This is the S&L redux, only with the fallout hitting the holding companies who bought the mortgages.

"....can afford a measly 1.5 B to bail out 500,000 home owners."

Posted by danni

The simplicity of it will undoubtedly make that impossible.

But people need to feel we aren't just bailing out every idiot and opportunist that got burned in this. There needs to be some kind of procedure to control for all that.

What does a corporation's balance sheet have to do with bailing out morons. Hey maybe we should bail out anyone who owned Yahoo stock last week

What does a corporation's balance sheet have to do with bailing out morons.
Posted by timbci

It wasn't just that your usual morons defaulted on their mortgages, the amount usually expected, but that they were targeted in huge numbers. Banks had no interest in giving loans only to those who were a good credit risk because they were just going to sell the mortgages off anyway.

Hagbard Celine -

I'll go along with some rigid controls/limits on this bailout. Like bankruptcies - you can't take another one for X number of years (if ever), and it shows up on your credit report.

Love the musical sound of your handle, by the way (altho it does make me think of the horrible Celine Dion...). But no, I have not read the trilogy.