http://www.intellectualconservative.com/2009/03/16/how-you-too-can-benefit-from-the-foreclosure-bailout/ Conservative and Libertarian Intellectual Philosophy and Politics Wed, 08 Feb 2012 23:00:53 +0000 hourly 1 http://wordpress.org/?v=3.2.1 http://www.intellectualconservative.com/2009/03/16/how-you-too-can-benefit-from-the-foreclosure-bailout/comment-page-1/#comment-83465 RACHEL ALEXANDER: THE INTELLECTUAL CONSERVATIVE Tue, 01 Jun 2010 16:03:58 +0000 http://www.intellectualconservative.com/2009/03/15/how-you-too-can-benefit-from-the-foreclosure-bailout/#comment-83465 [...] http://www.intellectualconservative.com/2009/03/16/how-you-too-can-benefit-from-the-foreclosure-bailout/ The fundamental problem with the foreclosure bailout is it encourages and perpetuates the type of behavior that contributed to the recession in the first place – enabling people to buy homes they cannot afford. Someone who bought a $400,000 home, refinanced it with a sub prime loan in order to get cash back, putting them underwater, then bought a luxurious new SUV, should not be entitled to a free $100,000 bailout from the rest of us. What is going to happen to their $400,000 house in five years when the low interest rate provided by the bailout expires? South Carolina’s Republican Governor Mark Sanford says the bill rewards irresponsible behavior, since “95% of folks are playing by the rules and struggling, but are still paying their mortgages.” Minnesota’s Republican Governor Tim Pawlenty questioned the government’s involvement at all in private mortgage contracts. [...] [...] http://www.intellectualconservative.com/2009/03/16/how-you-too-can-benefit-from-the-foreclosure-bailout/ The fundamental problem with the foreclosure bailout is it encourages and perpetuates the type of behavior that contributed to the recession in the first place – enabling people to buy homes they cannot afford. Someone who bought a $400,000 home, refinanced it with a sub prime loan in order to get cash back, putting them underwater, then bought a luxurious new SUV, should not be entitled to a free $100,000 bailout from the rest of us. What is going to happen to their $400,000 house in five years when the low interest rate provided by the bailout expires? South Carolina’s Republican Governor Mark Sanford says the bill rewards irresponsible behavior, since “95% of folks are playing by the rules and struggling, but are still paying their mortgages.” Minnesota’s Republican Governor Tim Pawlenty questioned the government’s involvement at all in private mortgage contracts. [...]

]]> http://www.intellectualconservative.com/2009/03/16/how-you-too-can-benefit-from-the-foreclosure-bailout/comment-page-1/#comment-77050 Ivan Ivanovich Mon, 16 Mar 2009 08:32:40 +0000 http://www.intellectualconservative.com/2009/03/15/how-you-too-can-benefit-from-the-foreclosure-bailout/#comment-77050 Funny you should mention the SUV thing and not mention one of the major problems for homeowners. The removal of the deduction for auto loan interest coincided with the introduction of home equity loans. Many home owners reacted buy taking home equity loans and buying cars. Not necessarily Cadillacs, but like myself a $10,000 used pickup and a $11,000 used compact for my wife. Add to that the cost of a wedding for daughter number one and it's easy to see a combined mortgage that equals 67% the value of a home. A drop in home prices of 1/3 puts the mortgage at 100% pretty quick. If the Feds were serious about helping home and car owners they would simply reinstate the deduction for cars. Why is no one talking about this? Funny you should mention the SUV thing and not mention one of the major problems for homeowners. The removal of the deduction for auto loan interest coincided with the introduction of home equity loans. Many home owners reacted buy taking home equity loans and buying cars. Not necessarily Cadillacs, but like myself a $10,000 used pickup and a $11,000 used compact for my wife. Add to that the cost of a wedding for daughter number one and it’s easy to see a combined mortgage that equals 67% the value of a home. A drop in home prices of 1/3 puts the mortgage at 100% pretty quick. If the Feds were serious about helping home and car owners they would simply reinstate the deduction for cars. Why is no one talking about this?

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