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 ...
It’s also worth noting that a substantial portion of the population growth in the last six years has probably involved people entering this country illegally. These people are far more likely to rent their homes than own them.
This is why it is so astounding. Non-homestead collateral can be lien stripped and the renegotiated.
Part of the reason the IRS “hits” the bankrupt forclosed is that the lender writes OFF the loss and teh IRS is trying to “recapture” the taxes from another source.
If courts can restructure bankrupts debts to ME, why should mortgage lenders be different?
Really low interest rates were a heroic effort to get people into home ownership. But the result was overpriced housing, speculation and now there are a lot of people that own too much over-valued housing.
The market is still in free fall in many areas. Forcing the lenders to modify loans will only result in future higher interest rates and fewer new homeowners.
But it takes an adversary proceeding to strip off the negative equity in a bankruptcy case. Most mortgagees cannot afford such a proceeding.
Ah, if you imagine that you have the right to live where you wish to, then off to the reeducation camp for you as well, Comrade.
Man, the FReeper gulag is filling up quickly.
So what?
Forcing the lenders to modify loans will only result in future higher interest rates and fewer new homeowners.
The market will set interest rates. You say "fewer new homeowners" like that's a bad thing.
yes, hency my statement about a bankrupt who can afford it.
HOWEVER, an adversary is not always needed (at least pre2005) if you had a lender who was willing to negotiate and see the futility of their position.
What I have seen of late is lenders who have no clue about business and are in a “screw everyone” mindset.
While the 2005 reform only managed to increase ch13’s very slightly, I think the trend to more plans than liquidation is going to force trustees to get into the stripping mix in order to preserve the income source for the other creditors.
Yea, you’re correct; then again, to what extent are they “counted”. They may be, I just don’t know. Now I do believe that a large number reported as non-homeowners are “legal” immigrants who, like their predecessors, i.e. Italian and Irish immigrants, take some time to get settled into the economy. For example, I’ve read stories of Russian immigrants who land in NY; work there a year or more as cab drivers while going to school, etc. who simply can’t afford home ownership for a number of years because it takes them that amount of time to learn and settle into our “system”.
And some of us would like a 100 acre or so farm, preferably with a pond/lake.
If it’s a large puppy the third-worlder might eat for a few days...
Some would rather have a “Great Society” than the “American Dream”.
http://www.google.com/search?hl=en&q=Lyndon+Johnson++%22Great+Society%22
President Bush’s appointed ambassador the the Netherlands is Ameriquest owner and king of Sub-prime, Roland Arnall.
>>ambassador the the Netherlands
Should be:
ambassador to the Netherlands
They know, they just don't care. Congress is in the business of buying votes with other people's money.
Are you stating the avg for the population or for home owners?
You sure they do?
They probably do, but realize that most people are too damn economically ignorant to realize it.
As soon as enough realize this, count on the left in government to try to make it ILLEGAL to pass on government imposed costs.
Socialists will never understand this as they tend to work for not-for-profit enterprises like the New York Times.
Population as a whole.
“Socialists will never understand this as they tend to work for not-for-profit enterprises like the New York Times.”
Nice Coulterism!
The Trustees are so overloaded that it would require some new case law to mandate such actions, IMHO.
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