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Obama Administration To Extend Mortgage-Free Living For America's Unemployed To One Year
Last week it was discovered that the means by which various big banks are dealing with the Option ARM cliff is by enforcing outright mortgage debt forgiveness, in some cases as large as 50% of the total principal.
Which is why it should come as no surprise that the administration, in
dealing with the lack of an unemployment cliff, has decided to extend foreclosure-free living for unemployed homeowners from a few months to a year. From USA Today: "The
administration today will announce that two programs providing
unemployed homeowners a few months' forbearance on their mortgages will
be extended to 12 months, said three administration officials speaking
anonymously because the program has not been announced. Thousands of
homeowners could benefit from the additional time, although not all
jobless homeowners will be eligible. The action is being taken as part
of the administration's effort to help prevent foreclosures while
unemployment remains above 9% and the economy struggles to rebound." What would be great if in addition to such openly
socialist policies the administration would enforce the implementation
of sinking funds for said unemployed workers, who instead of taking
unemployment benefits from the government and converting it into less
than edible iPads, would actually set aside money for that eventual
mortgage payment. Of course that will never happen: after all why
redirect freshly issued fiat from being recycled into the economy and do the responsible thing when nobody in America expects to pay their mortgage
payments ever again. And some wonder why retail sales in June came as
blistering as they did. Simple: when the US consumer no longer has to
spend any money on the biggest traditional use of capital, housing, the
alternative is everything else. And for those attempting to figure out just how this
is deflationary (for everything but housing of course, but that's one
deflation that will only hit the pocket of Uncle Sam), we would kindly request an explanation as well when someone has an answer.
More:
The Federal Housing Administration began offering four months of mortgage relief to unemployed homeowners nearly a decade ago. Banks and mortgage brokers participating in the program must comply with the new standard. The Home Affordable Modification Program has been offering three months of relief to the unemployed since last year. Those who service mortgages under the program are expected to follow its voluntary guidelines.
To qualify for mortgage forbearance, unemployed people must be looking for work. Those who can afford to pay a portion of their loans must do so.
Skeptics about this program should shut up: it is a "win-win" for everyone. Because in Obama-style economics zero sum is no longer relevant.
The revised programs are intended to be a win-win for borrowers and banks, which can avoid having more homes go into foreclosure by giving borrowers more time to pay.
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Uh, that's just YOUR problem, YOU don't HAVE TO PAY.
In the contracts you signed unless you are complete dolt are the terms to not pay.
YOur choice , but no you don't get to force your choice on others.
If you don't like the tax system , don't pay.
again YOUR CHOICE.
Debt forgiveness is the latest entitlement.
In 2009, Sec. Geithner extended "infinite" taxpayer guarantees on all Fannie/Freddie loans through 2012. Just socialize the losses. Now, they are following through!
But this also create "infinite" moral hazard, all at the expense of taxpayers through off-balance-sheet losses that everyone else must pay. There is no risk any more. Wall St perceives no risk, and homeowners who can't pay perceive no risk. It's a risk-free society, in which all risk is merely passed up the social(ist) ladder. Eventually, all this risk is going to bring some very filthy chickens home to risk -- I mean roost! And when that day happens, it's going to be very, very UGLY!
Not only is this more total BS its not even going to be dealt with fairly :
Thousands of homeowners could benefit from the additional time, although not all jobless homeowners will be eligible
Anyone feel like taking a guess how this one will be means tested?
Fucking joke.
Skin color, gender and number of children, of course. Like every gov't program.
NO QE3 SAYS PIMCO
http://gmbpost.com/investment-news/low-chance-of-qe3-pimco/
Is Bill Gross offering to step in and buy all those lovely treasuries to keep the government afloat then? Didn't think so. Why, then, does he think that others, apart from The Bernank, will do so? Why would they?
The .gov is just a big ATM. Money keeps coming out, forget about where it comes from or what the consequences are, keep the dough rolling. Those are voters too!
Who gives a shit. Give 'em enough rope to hang themselves. All this will do is make the lazy people, who don't want to work, more lazy. BFD. They still won't have jobs, now and not in the future. So they live a little while longer in their houses, on the $1500 a month the government gives them. Then what? 12 months isn't that long. You're still broke. Lazy. And unemployed.
until the extend it for the rest of their lives or write a bill that all unemployed people get to keep their houses for free.
then you're the moron.
...and a vote to be bought. Paid for by the taxes of some other poor sucker.
Until the next handout. The one I'm busting my ass to pay taxes to support. I don't want the handout but I don't want the IRS' hand out for my hard earned dollars either. Burn the fucking house down and watch the "Obama's gonna pay my mortgage and buy my gas" cockroaches scurry for their lives. I'm as ready as I'll ever be for it and so are a lot of other people who don't have their heads buried in the MSM-sand. When does it stop otherwise?
Bullish. Next stop, 100 P/E S&P.
Boy, was I ever a dumbass!
I built my home with a construction loan. Paid it off 30 years ago. Bought other property with cash. Got silver coins at face value. Still got 'em.
I built the home on farm land and still have the 40 YO tractor. It will run on peanut oil BTW.
Never mind. Y'all can just leave me alone.
I have a 50 year-old John Deere 820 with a German built diesel. Never tried peanut oil, but she runs like a top on tax-free red-dyed diesel from my 700 gallon farm tank (because it is just regular diesel dyed red).
http://dailyreckoning.com/files/2009/12/DRUS12-17-09-9.GIF
2nd Wave ARM
and if i was renting b/c my income is cyclical and varies, and i thought it would be imprudent to tie myself up to one place in the country, with high monthly payments? if my income stops completely, i'll be on the street, while millions of greedy moron will live in their mcmansions paid for by my tax dollars?
and even if those "unemployed" find a new job - how much you wanna bet that it will pay at least 25% less than their old job? how many of them will be able to afford that house? this "12 month free living" gig will have to be rolled over into some sort of HAMP or adusted payments plan, stretching over 40 or 50yr mortgage!
bottom line: they will default sooner or later. or, to be precise, they will default when free money will stop flowing.
it's a robbery of the (still) tax paying public!
Look this is just better than building a couple of hundred free fed gvt run shelters.
That's all it is. Hard to do crowd control when you concentrate the crowds.
you think these flash mobs are bad now. toss all of them out and see what you get.
The best of the options left to a collapsed system so far.
Sir: Are you suggesting that the President of the United States is involved in skullduggery?
Actually that POS is not the POTUS, he is a usurper. Even though by the unshakeable law of public bullying, anybody raising the issue gets slapped with the label "birther" and is thus without credibility, the evidence that the White House posted a fraudulent birth certificate has become overwhelming: http://www.wnd.com/index.php?fa=PAGE.view&pageId=316749
How can this stand?
because americans are either clueless, apathetic, or etiolated.
Sent me to the dictionary on "etiolated," heh.
Me too- +10,000 to jomamma.
Last one was about ten years ago, when I ran across proprioception.
Well done!
No, nothing that sinister. He's just skullfucking the (actual) taxpayers to buy his next election...
look for ipads to break record sales
"People make me listen pay my $ 1 B 30 seconds spots, chuckin, jiven, 30 seconds, spots, 30 30 30 seconds spots" Bullworth.
BULLECONOMICS: marginal propensity to default; get im in debt, like in hollywood,
and them our bitches, get im addicted to heroin
health care and they re our slaves....
a NO DOC no income fraud loan is our right,
and IF you dont give it to me by govt manadate
ill sue, if it aint free, at 3 % down.
F*** da banks, let em raise credit card rates
or go broke....
and if it goes down, ill just walk away.
30 second spots, 30 , 30, 30 seconds spots,
Let me hear ya say it....SOCIALISM (Bullworth
So the dough doesn't go to banks but to retail. Where does it go from there I wonder?
Debt forgiveness, the new entitlement!
My best friend ran up $30,000 in 12 months on his credit cards on speculation. He's nearly 50 years old without a dime of savings. Then, he immediately ran to a credit counseling agency and they got his credit card bills cut in half. He's glad that in a few more months, he'll have what's remaining paid off, and he can get his credit cards back. Meanwhile, he bought a 52-inch TV and a new washer on credit.
What a messed up world that such irresponsible and risky people can get money endlessly, while the FDIC and taxpayers must foot the bill for the losses.
and your job is what. Like as not these types of clowns are what is supporting
the great consumer rally. THey have been trained from birth that USA
consumer is the great and moral choice in the world.
What of the "animal spirits".bhaaaa bhaaaaa.
You don't want to take their faith and dream away now do you?
USA USA USA USA!
the look of despair in their eyes can be heart wrenching, but it's at that moment that you realise they do not yet have the will to save themselves through constructive action, and potentially never will.
Free Market Capitalism has to be suspended per Hank Paulson...
Who is getting bailed here?
At the end of the year the people still will be underwater on these loans. Will they have paid more or less than if they had rented the entire time? Hard to know, but they will have lived with the stress of knowing that at the end of the year they will have nothing. All the folks who bought what they could afford have not had to live through this kind of hell for the last 3 years. Virtue is its own reward.
At the end of the year the banks will have the same properties on their hands, worth about the same as now. Will there be another big foreclosure bump a year from now? In the meantime the banks look solvent. Another year that the banksters can hold their heads high and pretend they are not all fellons.
The US is so long past facing economic reality that expecting it to happen at this late date is laughable. The pious Republicans calling for restraint now are the same ones would spent like idiots before Obama and will spend like idiots after Obama.
There is no good outcome from here. What is proposed appears to be the least bad outcome.
they will have lived with the stress of knowing that at the end of the year they will have nothing. All the folks who bought what they could afford have not had to live through this kind of hell for the last 3 years.
Stress? Hell? Try living to make ends meet in a rental because you dont want to be a leach. Thats stress. The stress of not wanting to drop out and having nothing left to lose. When you hit rock bottom like those getting everything from the State , you have no stress - you literally have nothing left to lose apart from the govn tit that keeps you warm. Well excuse me , but fuck that. Thats not stress. That called giving up and being rewarded for it.
Those folks have been on a rolling bailout from day 1. At the end of the year they will have the same as they do now , the same as they did last year and the years before that : debt.
All the toys and excess real esatate they dont need is what they have to show for that debt , which has to be LIQUIDATED.
So when they are downsized from their >3,000 sq ft houses they cant afford to heat or keep aircooled , with their Plasmas in every room that they cant afford the cable subscription for , people who have been living within their productive means to bankroll this game will have a chance to improve their lifestyle at the expense of those who made mistakes. Sacrifice now for reward later. Get it??
Because that my friend , is life. The rest is just ideologues getting in the way. Unfortunately idelogues can get it the way for a long time and it seems this Obama puppet is just what the banks wanted. At this stage , im all for a scorched eath policy - having my productive energy and taxes going into keeping the non productive comfortable is nothing but a perversion of nature.
you sound scared. Don't be. You can do much more than you have been brought up to believe.
If you are scared of hitting bottom, dont' be.
That's the trap they hold over you.
If you have anything you can't give up in 5 minutes then you are owned.
Damn right im scared. The lunatics are running the asylum. Im scared of putting my family in harms way. The only thing i cannot give up in 5 minutes is my family and a small velvet pouch. The rest is just to make living more comfortable.
They dont hold a trap over me anymore than i hold a trap over myself - but if putting a roof over my head and food on the table through my own efforts is a trap , then i guess we were all trapped the moment we were born.
As for those wondering why not everyone is made to benefit: Because then no one would be fighting with each other, and everyone would see that this cannot add up...... that the US economy simply consists of buying imported goods with debt or monetization.
Obscurity and distraction - that's why only some benefit, and only via obscure exception rules.
The irony is, that in the SHORT-TERM boosting buying power with debt, would actually be part of a solution, BUT only if other measures ensure that this buying power is then spent on locally produced goods, so as to strenghten local production at reasonable wages, so that in the LONG-TERM this artificial boosting stops being necessary.
The trend is your freind. The trend now is not to pay your mortgage. The trend next will be not to pay your energy bills, taxes, etc. Become unemployed and live off others...What a great country we live in. Welfare for everyone...
Perfect timing of pre-election give-aways to gain votes, make the economy appear better than it really is and to allow banks to continue to extend and pretend all is well.
"who instead of taking unemployment benefits from the government and converting it into less than edible iPads, would actually set aside money for that eventual mortgage payment"
There is no fix for this other than letting house prices drop to where they should be based on actual incomes...so they still have a long way to go. Neither Obama nor most people on this website, (including Tyler on this one) are acknowledging the contradiction we have gotten into. The idea that a large portion of these Americans actually have money to set aside for eventual mortgage payment based on overinflated mortgages and are spending it on iPads is an absurd distraction from the real problem. I think this meme about peopel buying gadgets instead of paying mortgages has run it's course and isn't contributing anything to the reality we find ourselves in, because it implies that we as a country can actually afford to continue paying overinflated housing prices based on a society that has hollowed out it's own economy for the past 30 years.
Agree totally that this program of Obama's is moral hazard at it's finest, but to ignore the fact that the other side of this coin is going to be a much needed continued freefall in prices isn't honest either. Those who are behind or in danger of being behind will default, prices will eventually settle back to 1990 levels and quite a few banks will go down in the process...there's really no way around this. Our system finds itself in a box where neither side of the arguments we are hearing acknowledge the tremendous pain heading our way in order to reset the system.
a sane reality based post, at least as I have seen since around 2001 or so.
Sorry sheep you have been sheared already, now we are just waiting for the winter to
finish you off.
This (the wasted energy input) will go on until it can't anymore. Then it will stop. Delusion will trump reality until it can't.
At that point, enter the second law of thermodynamics as controlling the rates of many reactions.
Try to ride, rather than fight, the chaos.
Energy input at this point should be directed to deflection, not reversal.
Choose your spots, limit your downside, try to entertain yourself.
Those with a good sense of humor, a creative mind and a "go with the flow" attitude will be best suited to making the days palatable.
Know your risks, know your downside, maintain good information.
Someone should tell Barry that one year is a joke. In my old neighborhood people the four surrounding homes haven't paid mortgage in over three years.
Cash out your 401k, take out a huge loan, and spend it on boats and hoes.
BARRY-O I NEED JOO!
http://www.youtube.com/watch?v=MxB8Z7GL6yc&feature=related
Moral Hazard?
Late last week, Thomas James Ball reached his breaking point. Driven to desperation by a system that bankrupted him and destroyed his family, Ball walked up to the main door of the Keene County, New Hampshire courthouse, doused himself with gasoline, and lit himself ablaze.
http://lonerangersilver.wordpress.com/2011/06/20/new-hampshire-man-light...
And no one gave a damn. America is too busy playing video games and watching Survivor.
It's DEFLATIONARY because it shows how little demand there is in the consumer sector. It is extremely difficult for governments to create inflation. They can increase the MB a quadrillion times and can enact stimulus but if the consumer does not spend there is NO inflation. The private sector will not expand until their liquidity situation improves either by default, asset price increase or savings. I do not see why this is so difficult for the inflationists to grasp. Yes if debt to GDP numbers return to expansionary/contractionary trough levels (5-20 years?) and the central bank cannot retract it's MB easy money policies we will have HUGE inflation in non-investment assets.
most of the boomers have to die off before anything can recover in housing.
simple and unavoidable.
Are there still tax consequences to debt forgiveness? Does anyone know for sure?
This is a perfect reflection of the attitude in progressivism that only the collective matters. There are not only no individual responsibilities, but there are also no individual rights. Only the "collective" has rights. This is the foundation of "social justice" and Obama's brand of Christianity in which there is "collective salvation" also. He has stated that his belief system is based upon "collective" salvation, not "individual" salvation. If only the "collective" has rights, then individuals have... uh, NONE!
Good observation.
There is no such thing as collective salvation in Christianity. The Gospels are clear on this point. For this reason, Marx and Engels could not accept Christianity because the foundations of Communism can only exist when individuals are expendable for the benefit of the State, for the collective.
Actions speak louder than words.
What about "the needs of the many outweigh the needs of the few"? Wasnt that in the Christian bible?
Just asking , i wouldnt call myself religious.
That was in Star Trek II Wrath of Khan.
hahah yes but it was in the Bible too , some fellow named Caiaphas.
No, I believe you are referring to the Communist Manifesto.
“That which is called Socialism, Marx named the first, or the lower, phase of Communism.” V.L. Lenin: Sochineniya Works, 4th edition
As for Socialism, The Christian Ten Commandments say:
#8 “Thou shalt not steal.”
#10 "Thou shalt not covet thy neighbor's house, thou shalt not covet thy neighbor's wife, nor his manservant, nor his maidservant, nor his ox, nor his ass, nor any thing that is thy neighbor's."
“The monstrous views (i.e., Socialism)…these venomous teachings.” – Pope Leo XIII: Quod Apostolici Muneris
This is a perfect reflection of the attitude in progressivism that only the collective matters. There are not only no individual responsibilities, but there are also no individual rights. Only the "collective" has rights. This is the foundation of "social justice" and Obama's brand of Christianity in which there is "collective salvation" also. He has stated that his belief system is based upon "collective" salvation, not "individual" salvation. If only the "collective" has rights, then individuals have... uh, NONE!
How many more days can the American system exist without returning to at least an appearance of equal justice?
The Obama Administration will select which citizens to help with mortgage debt and which citizens to punish for responsible action.
The Central Bank will decide which retail chains on the mall or which crony corporations shall receive secret handouts from the public treasury and which small businesses or companies competing with the bank’s favorites shall be eliminated from the market place.
This morning I listened to a constitutional expert discussing the war powers act in regards to the Libyan War. The law says that the President must obtain congressional approval within sixty days if he uses U.S. forces in “hostilities.” Said the constitutional scholar: The law in this case depends on the interpretation of “hostilities” and has been reduced to a subject where the opposing viewpoints argue their case. He shows the injustice of it; that the two sides are just posturing, except for the few such as Ron Paul and Dennis Kucinich. If it is impossible to enforce the law, there is no law. It is mere mockery.
Americans watch these developments with despair. Only a true representative government would be able to restore the credibility and justice of the American System; but, alas, the Administration and the Congress are hopelessly captured in the net of tyranny wielded by the Federal Reserve Bank and its private owners.
Walking away from "debt": Strategic default makes sense, its merely a strategy of survival. Banksters done it and they taught us well. Thank you Jamie, Lloyd et al.
40 acres and a MULE?!? and all I have to do is make my 'X' on this here ballot?? count me IN!!
Free stuff; that's right, if I'm elected/re-elected there will be free stuff. Can't afford your mortgage/car/credit card payment, no prob, we got your back. If I/we are elected there will be no more problems EVER. Inoperable tumor? No sweat, we erase it off the x-ray. 6 months to live, but can't quite get everything sorted? No problem, we'll get you another 6 months. Cue the midgets and the dancing miniature donkeys.
I called my senators and congressman to complain and try to stop this.
thanks for the laugh.
xxx
Where's the ACLU? 14th Amendment requires equal protection under the law. The gov cannot give favored treatment to one class of citizens without giving it to all. Let the class action suits begin! Long live Amerika!!!!
Some animals are more equal than others.
I played the game by the rules.
What did it get me? Nothing.
I'm a sucker paying taxes.
Same here.
I thought I got a good deal on our little house in '07, couldn't put much money down, and decided to go ahead and buy. We've never missed a payment and now my wife lost her job and it's starting to get tough with mortgages and student loans. We've had our house on the market for 2 years now, asking just enough to break even, and can't sell the damn thing.
Still, we make ends meet (barely) - put I feel like a sucker when I hear about another entitlement programs like this one. Somedays I just want to walk away from it all and say screw it. But like someone else posted earlier, I have to look at myself in the mirror everyday and I have too much pride, integrity, or whatever to just walk away.
It seems that I come into contact with more and more people (esp. those younger than me) that have a sense of 'entitlement' and think that they are owed. Well, programs like this will only make it worse. Maybe that's what TPTB want? I don't know, but something must be done to reverse course.........
so 1 year of savings.. for the banks.
No Litigation Expeses or at the least less.
No Taxes, City / State owed by the Bank in the event the Property is empty. more money we the people can make up for!
Losses, Federal Tax Earnings for the Bank.. more money we the people can make up for!
This is good for the Banks, Bad for the States and Worse for "We the People".
But it is spun to sound like it is helping the people struggling. Next year they will still be 12 months behind and un-employed.
Pretty much the Administration's way of saying: YO'JOB AIN'T COMING BACK!
But after you re-elect me, I have no idea who the fuck you are.
bread and circuses bithcez.
So there is an FHA program as well as HUD, plus untold masses not paying their mortgages, though keeping current on their credit cards? You know this is going to end badly, but when? And what's the catalyst? I feel so stupid right now... not even underwater on my f'ing mortgage.