On another thread, I suggested that banks might need to re-negotiate the ARMs to allow the homeowners to be able to continue making payments. Another poster told me it wasn't possible because the loans had been sold and the corporations who bought the loans would file suit. I still think they'll either re-negotiate the loans and we can get a soft landing or all H#LL can break loose.
With all these plans for bailouts I am afraid regulations will be needed that the only mortgage one can have to purchase a home is a 30 or 15 year fixed rate fully amoritizing with 20% minumum down payment with strict debt-toincome guidelines (full docs). I find this idea abhorant but everytime there is some problems the gov’t swoops in to use our tax money to bailout speculators, people who should of not been in a home in the first place, etc. I purchased a home I could afford with the standard 30 20% down. Now I make payments on my mtg and am expecte through my tax dollars to basically subsidize someone’s mortgage. As part of my program I would ban cash out refinances, 2nd mortgages, etc. This will stop people continuously refinancing and cashing out to live lifestyles beyond their means. THen when the goood times are over they become sob stroies on TV. As I said before this proposal sucks but it is obvious there is no such thing as letting the market work in residential real estate.