Posted on 02/20/2009 4:23:31 AM PST by smartyaz
Bus driver Minta Garcia admits that she and her husband bought more house than they could afford, but she said "the lender made the purchase all too easy." Now the home that she purchased for $800K is worth $675K and she wants Obama to "Stop the foreclosures".
(Excerpt) Read more at housingdoom.com ...
Had a conversation with a guy the other day who assumed we were getting a check from the stimulus like Bush sent. I had to tell him it was only $400 and it would at $13 a week in our check until January and would drop to $8.
He was shocked and upset because “I don’t own no damn house.”
His point is he was struggling too because of increased rent and yet his landlord got the help and he was certain it wouldn’t pass down to him.
Excellent post! Going in the ‘Freeper Keeper’ file!
What happened is they underestimated that the producers don’t consider themselves “rich” and they recognize the “rich” have enough lawyers to get them out of most of the crap and/or can afford it.
They see that what they were ASSURED in campaign promises wouldn’t happen is happening. The middle class is getting screwed and the ones who actually do the right thing are helping people keep a home they could only dream of.
I know as I went into people’s brand new nice houses I would think “How are they affording this? I am just getting by with my 30 year old 1100 square foot house!” Now I know and instead of them feeling the pain of making foolish decisions, I get to keep my crappy old house and help them keep their nice one.
And they're depending on "the sanction of the victim," where the victim are those of us who will have to pick up the bill. Unfortunately there are far too many people who will just "suck it up, but eventually the majority will finally get sick of it and say, "BY WHAT RIGHT?"
Mark
According to one of the "For Sale" signs they show at the end of the clip, Phoenix, AZ.
Who’d want to move in that house now? It probably smells and looks like the zoo’s monkey house.
My guess is, because of my limited involvement the real estate agency was the lender. I do not know how common this practice was, my involvement was limited. It was not until I was told my son needed from me a declaration that he paid me rent to qualify I told him to run. I met this agent one time to do a walk through on a house she was the listing agent, that fit the $150,000 criteria he could so call afford. The house was not literally worth $150,000 but that was the value it got appraised.
I knew from my experience something wrong was going on when a lender would/could lend that much money with nothing down being required.
That house doesn’t look like it could be worth even one-forth of what it cost.
Agree.
I’m suspicious of this report. Why isn’t husband shown? Why isn’t it told what he does for a living?
“BY WHAT RIGHT?”
Needs said again, and again! They have no right.
A long time ago I was told not to take candy from strangers. In the same vein, I was later told as a kid that I should I look long and hard at any deal that appears unexpectedly too good. The better it appears for no logical reason, the more you should walk away.
I thought that was basic common sense that kids get taught. Maybe I was wrong.
You STILL haven't heard of the "community re-investment act" which was given birth (along with ACORN) during the Carter Admin, and "beefed up" again during the Clinton admin?
" When the CRA was created during the Carter administration BY DEMOCRATS, the administration also funded with tax dollars numerous "community groups" that have helped the Fed, the Comptroller of the Currency, and other federal regulatory agencies to enforce the act. Under the CRA, if a bank wanted to make virtually any change in its business operations — merging, opening up a new branch, getting into a new line of business — it had to first prove to regulators that it has made "enough" loans to the government's preferred borrowers.
Tax-funded "community groups" like ACORN would threatn to file petitions with regulators that stopped the bank's activities in their tracks, sometimes defeating them altogether, if they didn't loan money to under-qualified minorities. The banks routinely paid off ACORN and other "community groups" by giving them millions of dollars as well as promising to make even more dubious loans to those who didn't qualify for them.
In order to try to diversify the risk of these loans, the Federal Home Loan Mortgage Company ("Freddie Mac") pioneered the "securitization" of bundles of these high-risk loans so that they could be sold on secondary markets. Such "securitization" exploded during the 1990s as a result of government regulation. As Fed Chairman Ben Bernanke himself stated in a March 30, 2007 speech entitled "The Community Reinvestment Act: Its Evolution and New Challenges" (published online by the Fed)
Securitization of affordable housing loans expanded, as did the secondary market for these loans, in part reflecting a 1992 law that required the government-sponsored enterprises, Fannie Mae and Freddie Mac, to devote a large percentage of their activities to meeting affordable housing goals". In 1994 the Riegle-Neal Interstate Banking and Branching Efficiency Act loosened up the regulatory barriers to bank mergers. Consequently, said Bernanke: "As public scrutiny of bank merger and acquisition activity escalated, advocacy groups [like ACORN] increasingly used the public comment process to protest bank applications on CRA grounds." In other words, there was a burst of additional legalized extortion perpetrated by the Fed and its pet "activist organizations" beginning in the mid-1990s. As a result, says Bernanke, "banks began to devote more resources to their CRA programs."
Also in 1995, the [RAT controlled] US Treasury Department created the multibillion-dollar "Community Development Financial Institutions" fund to "provide banks with access [i.e., taxpayers' dollars] to new opportunities to finance community economic development" as "encouraged" by the CRA, said the Fed chairman.
The [RAT] government also "streamlined" the regulatory requirements for CRA loans in 1995, allowing — and indeed pressuring — banks to make such loans without the benefit of many traditional credit-worthiness criteria, such as the size of the mortgage payment relative to income, savings history, and even income verification! Instead, the Fed told banks that participation in a credit-counseling program, many of which are federally funded, could be used as "proof" of a low-income applicant's ability to make his mortgage payments. In other words, federal bank regulators required banks to make bad loans based on nonexistent credit standards.
"In his April 26 New York Post article on the CRA entitled "The Real Scandal," Professor Liebowitz explains how the government's Fannie Mae Foundation singled out one bank in particular as the role model for all other banks in America in terms of its commitment to CRA lending: Countrywide, the nation's largest mortgage lender, had committed to $600 billion in low-income or "subprime" loans as of 2003. Today, Countrywide is essentially bankrupted and has been merged with Bank of America."
The myth that the CRA would not be harmful to bank-industry profits was hidden for years by the Fed-created housing bubble, which allowed for easy refinancing of all the bad debt. "[The] CRA increased lending and homeownership in poor communities without undermining banks' profitability," Robert Gordon proudly proclaims. But now that the bubble has burst, all those unqualified borrowers — whom the government calls "subprime," as though their credit ratings are only a tiny, tiny smidgen below "prime" borrowers with the very best credit ratings — are defaulting on their mortgages in droves.
Bank profitability has been extremely "undermined," to put it mildly. The bursting of the Fed-generated housing bubble is the reason why the CRA scam was not exposed until now, despite having been in operation for some thirty years.
WOW.
But someone somewhere initiated the change in the business model to allow or require lenders to lend money without requiring a % of the loan up front.
There also seems to be another liability brewing under all this pillaging and that is these counties that are having to do reassessments of property values down. I expect that with 4 + years of ballooning property values some counties are going to be in big trouble now that the projected tax base gone.
bttt
See Post #113
If they borrowed all $800K, even at 4.5%, that’s a $4K - $5K monthly mortgage, including taxes and insurance. That’s a mortgage for someone making $200K+.
However, I don’t think that this woman and her family are going to be eligible for the anti-Christ Obama’s program, in that it’s likely that her loan-to-value ratio is way over 105%.
THAT, is the other shoe that has yet to drop in a vast majority of states/county's. They haven't reassessed property values for the past 5 years, many are due this year. So while property values have dropped, they haven't dropped THAT much to levels on tax rolls from 5 years ago.
People are looking at a HUGE tax increase this year, on top of higher interest rates.
Dateline: 06/18/02 Calling a home the "foundation for families and a source of stability for communities," President Bush has proposed three new initiatives designed to enhance existing federal home buyer assistance programs by helping African- and Hispanic-Americans buy homes.
According to the White House, fewer than half of all African and Hispanic Americans currently own their homes, compared to nearly three-fourths of white Americans. "We must begin to close this homeownership gap by dismantling the barriers that prevent minorities from owning a piece of the American dream," said the President in a nationwide radio address.
To close the homeownership gap, President Bush proposed legislation funding the following new initiatives:
This mess we are in has taken bipartisan effort in Washington.
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