Posted on 10/08/2007 5:59:31 AM PDT by reaganaut1
For the first time since the Carter administration, homeownership in the United States is set to decline over a president’s tenure. When President Bush took office in 2001, homeownership stood at 67.6 percent. It rose as the mortgage bubble inflated but is projected to fall to 67 percent by early 2009, which would come to 700,000 fewer homeowners than when Mr. Bush started. The decline, calculated by Moody’s Economy.com, is inexorable unless the government launches a heroic effort to help hundreds of thousands of defaulting borrowers stay in their homes.
...
Federal regulators and Treasury officials are urging mortgage lenders and mortgage servicers to do their utmost to modify loan terms for at-risk borrowers, but saying “please” hasn’t worked. To be effective, modifications must reduce a loan’s interest rate or balance or extend its term, or some combination of the three.
...
Congress should move forward on other remedies. The most important is to mend an egregious flaw in the current bankruptcy law that prohibits the courts from modifying repayment terms of most mortgages on a primary home. Two bills, one in the House and one in the Senate, would treat a mortgage like other secured debt, allowing a bankruptcy court to restructure it so that it’s affordable for the borrower. That would give defaulting homeowners and their advocates much needed leverage in dealing with lenders and servicers. Creditors would presumably prefer to cut a deal with a borrower rather than be subject to the decision of a bankruptcy judge.
(Excerpt) Read more at nytimes.com ...
Historically, statistics show that 2/3 of the population is not “mortgage worthy” - ie, their responsibility level is such that they cannot be trusted to make the payments on a house.
What a 67% “ownership rate” tells me is that half of these people are going to default.
The “American Dream” is achieved after you make the decisions necessary to make yourself “mortgage worthy”.
It's not that high. The average credit score is 720 which indicates less than 3% likelihood of default. Now there are income factors at work there as well...but saying "2/3 of the population is not mortgage worthy" is hyperbole.
Just as it is impossible to have full employment; i.e., 100% employment, there is probably also a ceiling on full "home ownership." The NYT could've done a much better job by placing this in perspective, rather than draw some disastrous historical picture to slam the president.
How about we stop subsidizing the giant scam called Congress?
Some of us would prefer a lodge near a river in a scenic mountain valley, instead. Therefore your solution is completely unworkable.
;^)
We’ve become a nation of victims. Save us, Congress, save us!
not so much.
If they correct errors in the bankruptcy reform act they can save a large number. (going back to allowing homestead mortgages being renegotiated for the value of the collateral)
In addition they need to eliminate the tax penalty for the forclosures.
HOWEVER, this story reminds me the statistic game by the MSM. The IDENTICAL number during the clinton years was hailed as good while it was derided as bad under the GWBush years.
forgot to mention, it is not unilateral.
BOTH parties assumed the risk the collateral would devalue.
In bankruptcy, splitting the unsecured portion of the loan from the value of the collateral is logical.
When President Bush took office in 2001, homeownership stood at 67.6 percent. It rose as the mortgage bubble inflated but is projected to fall to 67 percent by early 2009, which would come to 700,000 fewer homeowners than when Mr. Bush started.
Uh... mr NY Slimes how about this; in 2001 there were 'only' about 8 million ILLEGALS in the USA. Now we have approx 30 million.
And su-prise, su-prise, those 30 million, LOW paid, UNEDUCATED, 'peons' - and CRIMINALS, who've invaded the USA aren't exactly 'home owner material'. Hell, they're not even 'tenant material' (1st hand experience).
And they're such BAD credit risks, they couldn't get a Juice Loan from the Mafia!
at the start of the GWBush presidency home mortgage lenders had to assume the loss of the value of the collateral. NOW under the Bankruptcy reform act, the homestead mortgage can not be stripped into secured and unsecured portions. Lenders know this and thus they have set themselves up for an all or nothing fall.
That said, the new move (among the bankrupt with the finacial income to fight it) is to challenge the home mortgage docuemnts and move the entire mortgage into the unsecured pile of debt.
The article is a slimy misrepresentation of ecconomics and law.
Thanks, which, if I read it correctly means that the NYT is as usual, all wrong again! Interesting to note as well that homeownership rates have soared dramatically during the Bush years. Report on NPR last week confirmed that and reported that the increase was attributable to considerable pressure on lending institutions to make loans available to low income, first time home buyers applying through and with the help of HUD whose new mission was to facilitate home ownership.
Odd isn’t it; Repubs adopt the “ownership” philosophy to assist minority home ownership only to be slammed by the poverty pimps.
Hey...a NYT hit piece against the POTUS...geeeee...that’s something new. /sarcasm on.
Don’t forget the cries from the professional victims groups to extend credit to more and more people (who weren’t credit worthy). Then the gov’t comes back and blames the lenders, or the victims groups cry again that the terms are too high.
And let’s not forget, also, that the friendly IRS sees any debt that you have written off under foreclosure as “INCOME” on which you have to pay taxes.
Off to the reeducation camp for you, Comrade.
8^)
Living beyond your means is theft. Subsidizing / enabling this behavior is aiding and abetting.
Which beach? (You just can’t satisfy some people!)
Bingo!
Lenders assume the risk. That's how the game's played.
Give a third-worlder a puppy and he'll eat for a day...
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