The American Dream! Home ownership. Unfortunately the American Dream-for many families- is becoming a nightmare.
According to Reuters:" U.S. home loans failed at a record pace in July despite ongoing federal and state programs to avoid foreclosures, which have severely strained housing and the economy."
Record numbers of home foreclosures? What happened to the billions, and billions, that Congress appropriated and then borrowed from China to help people and lenders renegotiate home loans?
We were told by the Obama administration that we had to do something, apparently anything, to stop the foreclosure crisis. However here we are-eight months into the Obama administrations first year and according to Reuters-not only are foreclosures at all time highs-up 7 percent for July-but upwards to 32 percent from the same time last year.
Well I guess the Bushulus, the Porkulus, and all the other pork barrel spending boondoggles of the last several months have been a waste of time. People bought homes in many cases that they couldn't afford, others have been slammed by the recession and are now fighting for their lives.
Americans were told that help was on the way. Seems help got lost somewhere along the way along with billions and billions of dollars.
This may sound harsh but it comes from someone who barely managed to escape foreclosure just as the first mortgage meltdown occurred. In fact if I had waited just a couple of months before catching up my payments I would have been eligible for a "loan"modification. (See yesterdays story)
This may sound harsh, but I think if the government had stayed out of all this downturn stuff, and allowed the free market to work, we would already be out of the crisis. Government cannot solve our problems. In fact as Ronald Reagan said "Government is the problem".
Things would have been pain full. But in the long run, I think we would have got back on track sooner. As it sit stands now we have so mortgaged -our own as well as - our children's future so much that the next foreclosure sale may well be America itself.
2 comments:
Doesn't it seem strange that THE ONLY ADVICE government officials give homeowners having mortgage payment difficulties is to tell them to go back to their lender, or through a HUD/FHA Counselor (and then back to the lender) to obtain Home Loan Modification help?
Let’s investigate this for just a moment.
During the home sales boom cycle the lenders became VERY GREEDY. As the opportunity for profits went up, the ethics/legality/morality of the loans they made went down. Later in this process loans were even being made to persons with no jobs and little, or no income at all!
Oh, and where was the government during the loan feeding frenzy? They turned their heads and DID NOTHING!
The reports from borrowers who have completed Home Loan Modifications using these government recommended processes have been streaming in lately. VIRTUALLY ALL OF THESE REPORTS CONCLUDE THAT THE LENDER HAS GIVEN THE BORROWER VERY LITTLE, OR NO HELP AT ALL!!!
But, the government continues to tell borrowers that its assistance and the help of the lender is the best help available! WONDER WHY? IT’S THE MONEY!
Using this same logic, the best way to prepare your income tax and maximize your deductions is to go to the IRS for help!! Why do so many people (even the government officials we are speaking about) hire help to prepare their taxes? SINCE WHEN HAS FREE HELP EVER BEEN THE BEST HELP AVAILABLE?
So, what does the AVERAGE OUTCOME of a Home Loan Modification THAT YOU ACTUALLY PAY FOR really look like?
The firm I work for has averaged monthly mortgage payments reductions from between 20 - 50% for up to 5 years and the conversion of their existing loan to fixed interest rates in the 4 - 5% range for the full balance of the term of the mortgage! These averages come from over 200 completed resolutions!
Our firm is NOT ATTORNEY-BASED, but does have substantial knowledge about specific legal issues. Our firm has reasonable performance guarantees, a 100% Money Back Guarantee and reasonable program fees (well under $2,500).
So, let’s do the math. Say you are a homeowner who has an existing 6.75% fixed rate 30 year mortgage of $200k, that has a payment with interest of $1,298. Using the average results shown above, your new payment at only a 30% modification is $909 for up to 5 years and you will save well over $80,000 in interest over the life of the note!! NOW THAT’S A MORTGAGE MODIFICATION WORTH THE FEES, DON’T YOU THINK??
Ok, so you don’t plan on staying in the house much over 3 years - using these same numbers you will save over $14,000 in monthly payments alone in that time!! IS THAT A MODIFICATION WORTH THE FEES?
The answer is simple folks - THE LENDER AND THE GOVERNMENT THAT REPRESENTS THEM DOESN’T WANT TO GIVE THE MONEY BACK!
Foreclosure generally happens when the homeowner buys a property on a huge loan and cannot pay back the debt. But in recent times, there have many uncommon reasons for foreclosure and the behavior of the mortgage lenders who’ve been taking charge of the foreclosed properties. Such as, illegal occupancy of foreclosed properties, eviction of innocent tenants due to foreclosures, mysterious suicide due to foreclosure.
Post a Comment