Mortgage Holiday

[GG]

It would apply to all mortgages, not just those behind.

 

Read the link again. It would be a 100% saving on a mortgage payment for 1 year, Therefore if you have a $2000 mortgage payment per month,You would have $24,000 to put in the economy.

The Fed would pay interest on the loan for one year. No principal. Your 30 year loan becomes a 31 year loan.

 

Which would make this plan doubly more harebrained than the healthcare.

 

Assuming a total of $14 TRILLION of mortgage debt outstanding, one yr's worth if payments equals $1 TRILLION, or about 8% of GDP. If you think that the healthcare debacle is nuts, what you call a plan that calls for a staggering rise of the national debt with absolutely no means to pay it back?

 

As far as legal contracts, the government can take your property tomorrow under eminent domain, for any reason it cooks up. Is this so diferent?

 

No they cannot. Usually there's a constitutional challenge, especially if the case is taken from Chinese legal and government practices.

[Jim in Anchorage]

Which would make this plan doubly more harebrained than the healthcare.

 

Assuming a total of $14 TRILLION of mortgage debt outstanding, one yr's worth if payments equals $1 TRILLION, or about 8% of GDP. If you think that the healthcare debacle is nuts, what you call a plan that calls for a staggering rise of the national debt with absolutely no means to pay it back?

 

 

 

No they cannot. Usually there's a constitutional challenge, especially if the case is taken from Chinese legal and government practices.

You still don't get it. it's interest only, for one year. Do you mean to tell me the lenders in this country are collecting 1 trillion a year in mortgage interest?

I have no idea what the Chinese reference is about.

[Jim in Anchorage]

And no one making payments will still !@#$ the bond market sideways. "The government paying the interest" doesn't change that - bond pricing is predicated on principal and interest payments and the behavior of homeowners.

 

Again, it's an idea from the mind of someone who has no understanding of the industry. You know...like you.

Yeah the "industry" did real well predicting real estate prices, now they are into the behavior of homeowners.

Since you apparently know everything, Why not confine yourself to curing Cancer and skip all this chit-chat?

[GG]

You still don't get it. it's interest only, for one year. Do you mean to tell me the lenders in this country are collecting 1 trillion a year in mortgage interest?

I have no idea what the Chinese reference is about.

 

Do the math connor - $14 trillion of mortgages at 6% = $840bn in interest alone. You can slice up the mortgages by single family units vs apartments and other types, but the residual effect that you'd be throwing into the financial system would be far more catastrophic than the mortgage "relief" for the 90%+ to the mortgage borrowers who are paying their bills on time.

 

The China reference is the belief that the government can rewrite a private contract for the public good any time it wants, which is what you're advocating.

[Jim in Anchorage]

Do the math connor - $14 trillion of mortgages at 6% = $840bn in interest alone. You can slice up the mortgages by single family units vs apartments and other types, but the residual effect that you'd be throwing into the financial system would be far more catastrophic than the mortgage "relief" for the 90%+ to the mortgage borrowers who are paying their bills on time.

 

The China reference is the belief that the government can rewrite a private contract for the public good any time it wants, which is what you're advocating.

Don't call me Conner I am not sure where you got that $14 trillion figure. I find it remarkable that banks have advanced that kind of money to non-corporate borrowers. I suspect your figure is more total debt, then property mortgages.

And yes, under eminent domain, the US[or the state] can take your property for any reason they wish. You can constitutional challenge all you wish [at your expense] but they will get it.

[GG]

Don't call me Conner I am not sure where you got that $14 trillion figure. I find it remarkable that banks have advanced that kind of money to non-corporate borrowers. I suspect your figure is more total debt, then property mortgages.

 

How 'bout doing some research?

 

Here you go Sue.

 

Next time, do your own homework.

[outsidethebox]

Yeah the "industry" did real well predicting real estate prices, now they are into the behavior of homeowners.

Since you apparently know everything, Why not confine yourself to curing Cancer and skip all this chit-chat?

LOL!!

[DC Tom]

Yeah the "industry" did real well predicting real estate prices, now they are into the behavior of homeowners.

Since you apparently know everything, Why not confine yourself to curing Cancer and skip all this chit-chat?

 

Can you actual rebut my informed points with any knowledge of your own? I mean, I've pointed out how the mortgage industry works more than once here. If you disagree, I'd assume you can do so in an informed manner?

 

 

Oh, wait...of course not. Look who I'm talking about.

[Magox]

You still don't get it. it's interest only, for one year. Do you mean to tell me the lenders in this country are collecting 1 trillion a year in mortgage interest?

I have no idea what the Chinese reference is about.

Let me ask you this Jim. If you are a home owner, and you are upside down by a decent bit, and you are on the fence in deciding whether or not you want to keep paying your payments or just let it go, and now the government has a program where you wouldn't be required to pay your mortgage on your home, what do you think many people will do?

 

Naturally they will stop paying their mortgages, and considering how the forclosure process is now taking 6-18 months before the house gets forclosed upon, many people will just stop paying their mortgages figuring that they will have anywhere between 18-30 months without having to pay a dime.

 

Not only that, the amount of forclosures that will hit the market in that time span will be mindboggling, if you think it is bad now, it would get 3 times worse under this plan, and their would be alot of uncertainty in the banking industry in how to properly value those mortgages and bonds, therefore just extending the housing crisis.

 

There would be so many people that would be circumventing this process it would be insane.

[Alaska Darin]

Government giveaways of taxpayer money are awesome when they seem to benefit me.

[keepthefaith]

Let me ask you this Jim. If you are a home owner, and you are upside down by a decent bit, and you are on the fence in deciding whether or not you want to keep paying your payments or just let it go, and now the government has a program where you wouldn't be required to pay your mortgage on your home, what do you think many people will do?

 

Naturally they will stop paying their mortgages, and considering how the forclosure process is now taking 6-18 months before the house gets forclosed upon, many people will just stop paying their mortgages figuring that they will have anywhere between 18-30 months without having to pay a dime.

 

Not only that, the amount of forclosures that will hit the market in that time span will be mindboggling, if you think it is bad now, it would get 3 times worse under this plan, and their would be alot of uncertainty in the banking industry in how to properly value those mortgages and bonds, therefore just extending the housing crisis.

 

There would be so many people that would be circumventing this process it would be insane.

 

The only good argument I've heard in support of a "holiday" is a scenario where the banks put borrowers on an interest only payment for a period ( 2-3 years). The benefit to the bank would be fewer defaults and possibly better forclosure recoveries if housing values rebound some during that time. Cash flow for the banks would be negatively impacted though.

[bills_fan]

The only good argument I've heard in support of a "holiday" is a scenario where the banks put borrowers on an interest only payment for a period ( 2-3 years). The benefit to the bank would be fewer defaults and possibly better forclosure recoveries if housing values rebound some during that time. Cash flow for the banks would be negatively impacted though.

 

 

The question is why would anyone buy a house during this period? Just wait for the big dump of foreclosures on the market. No demand, prices fall. Extend and pretend NEVER works. I don't care if it is the value of your home, the "assets" on the balance sheets or the used toilet paper currently occupying the balance sheet of the Federal Reserve. It will work for a while. Until it doesn't. Then...Boom!