Give Me a (Financial) Break!
No, seriously! If the government is in hand-out mode I want part of the action. Unfortunately, I’m responsible. I didn’t purchase my homes with no money down and 100% financing. I didn’t purchase a home twice as large as I needed. I didn’t purchase a home twice as expensive as I could afford.
Now, I know I always interpret these things wrong, but from what I gather, this new “Homeowner Affordability and Stability Plan” will make lenders reduce your mortgage amount to 38% of your annual income if you’re having trouble paying your mortgage. Then another 7% will be matched by the government so that borrowers are paying a maximum of 31% of their income on the mortgage. In addition, if you pay on-time/in-full for 5 years, you will get a $1,000 bonus each year.
So, let me get this straight: you act irresponsibily, then get your mortgage payments reduced to unfairly low rates (for this region). On top of that, you’ll get a $5,000 bonus? Oh, and you can still claim the interest paid on your tax return?
Sign me up! I’d like a McMansion in Weston, please. Preferably something with a pool and/or hot tub. There are only two of us so i think we’ll need a minimum of 4 bathrooms and 6 bedrooms.
Give me a break. I’m all for packages to boost the economy. But this seems completely unfair. Hell, a rental apartment in Boston typically costs more than 31% of your annual income. Shouldn’t renters then get the discount, too? Maybe we should cap rents based on salary. Again, I’ll take the luxury hi-rise 4-bedroom penthouse unit that previously rented for $4,500/month please. You wouldn’t mind adjusting that monthly rent by a couple of grand, would you?
I’m not an economist. I’m not a politician. Hell, I’m not even smart. Buy why can’t the mortgage lenders simply adjust the mortgages from 30 year loans to 50+ year loans? While they’re at it, they could possibly reduce the interest rate. This way, the bank still gets the money it was promised and the buyer still pays the amount they agreed to. And in a few years when the economy rebounds, the borrower can refinance to a shorter term and/or sell for a profit.
But I’m 100% against lowering the amount of the money people borrowed. And speaking of the borrower selling the property in a few years….are there any rules on that? Is it fair for the seller to keep the profit after they were GIVEN tens of thousands of dollars of our tax money?
UGH – I’m disgusted.
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I think you’re missing the forest for the trees, Karl.
Great Rant… Love it and I agree. We are being penalized for being responsible. Or it sure seems that way.
Hey, Jason!
Like I said..I’m admittedly rather ignorant about the whole thing (never claimed to be smaht). But this just doesn’t seem like the right plan to me.
Otherwise, I’m for many of the economic stimulus suggestions. I’m all for the infrastructure improvements that will put people to work (public transit improvements, bridge repairs, road maintenance). I’m also all for extending unemployment benefits for longer terms, providing cheaper healthcare then COBRA for the unemployed.
But bailing out homebuyers? I just don’t get it.
This all reminds me of the tagline from the very funny 80s movie “Rosalie Goes Shopping” – where a German woman (Marianne Saegebrecht…more famous from “Bagdad Cafe”) is married to a crop duster (Brad Davis – woof! – in his last role) in Texas somewhere, and thinks all of her children are entitled to the full bounty of the American dream…so she resorts to credit card (and bigger) fraud. The tagline was (it was the 80s, remember) “If you owe the bank $10,000, it’s your problem; if you owe them $1,000,000, it’s THEIR problem.”
Alas!
Where’s the funky house in the pic? California, I assume?
Hey, Fred!
I never saw that film. I may have to check it out.
And, yes, that obscenely large house is in California. It’s near Mendocino (in a town called Little River, I believe). It did have a spectacular view of the ocean, though.
I was initially against the stimulus plan, but from what you’re saying I might be getting a bailout!! “Show me the money!!”