McCain's mortgage buyout plan

iVillage Member
Registered: 08-05-2004
McCain's mortgage buyout plan
31
Thu, 10-09-2008 - 10:04pm
What do you think of John McCain's proposal to spend 300 billion dollars in federal funds to buy distressed mortgages?
iVillage Member
Registered: 03-20-2006
Fri, 10-10-2008 - 12:29am

I think it's nuts.
I don't think it would ultimately prove popular with most homeowners, either. What I imagine happening is this:

Say there's a small neighborhood of 10-20 single-family homes (average value of $100,000/home) , with 3 or 4 of the home-owners in the neighborhood holding "at risk" mortgages that are re-assessed and re-mortgaged at a new values of $70k. Let's assume you are paying your mortgage and in no danger of losing your home, so you are not eligible for the "bailout." When it comes time for you to move, and put your home on the market, what is it worth? If your neighbors with a virtually identical house listed their places for 70k you can bet you're not going to get 100k for your home. Suddenly all the homes in the neighborhood are devalued, but only the people about to foreclose are allowed to recoup the loss. Everyone else is suddenly in negative-equity land.

I may be wrong - I am not really a finance person, and there's a lot about this crisis that I "don't get," but that's my take, at first glance.

I think these people should just be aided in refinancing at a fixed rate for a 40- or 45-year mortgage. (Why is 30-years such a magic number?)

iVillage Member
Registered: 03-25-2007
Fri, 10-10-2008 - 1:22am

I think you're right, and it would be a much better idea to switch the loans to longer term fixed rates.

Sopal

<?xml:namespace prefix = v ns = "urn:schemas-microsoft-com:vml" />

iVillage Member
Registered: 09-26-2008
Fri, 10-10-2008 - 1:27am
He was for it before he was against it. LOL!
iVillage Member
Registered: 09-08-2008
Fri, 10-10-2008 - 1:39am
Well, McCain proposed that "we go buy people that can not stay in their homes" lol. I knew it wasn't long before he admitted his true motivation for this last hour "plan" that he "borrowed" from the actual "rescue plan" that he just signed in D.C. Huh? Which way is up for McCain? He's hit bottom now.

iVillage Member
Registered: 08-20-2008
Fri, 10-10-2008 - 7:30am

McCain's idea to throw another $300 billion on top of the $700 billion is not a good one, to be charitable. First of all, it runs counter to everything the man has been saying about balancing the budget. Second, why not see if the $700 billion works first before we throw in another $300 billion? Third, given that he threw it out there at a debate in which he needed to turn the momentum against Obama, it just smacks of more politics.

It's time for a change. After all these years under the Republicans, they are leaving us with a huge mess in our economy, very costly long-term occupations of two countries that are not going well, and bin Ladin still on the loose.

iVillage Member
Registered: 07-22-2004
Fri, 10-10-2008 - 8:08am
I believe the plan wasn't to throw another 300
iVillage Member
Registered: 01-28-2004
Fri, 10-10-2008 - 8:25am
The stock market is preparing for a Obama win with it's continued downward slide. Careful what you wish for, the market is always right.
iVillage Member
Registered: 10-25-2006
Fri, 10-10-2008 - 9:05am
HA! The market does not care who wins. "It" just wants Bush and his anti-regulation cronies out of there!

-----------------------------------------------
http://www.pnhp.org/news/2009/october/meet_the_new_health_.php

http://www.youtube.com/watch?v=DQTBYQlQ7yM

iVillage Member
Registered: 01-28-2004
Fri, 10-10-2008 - 10:33am
So Obama cronies will be better?? I'm betting not. Market not better or worse one year from today.
iVillage Member
Registered: 03-25-2007
Fri, 10-10-2008 - 10:53am
One thing we can agree on...we're in for years of financial and economic

Sopal

<?xml:namespace prefix = v ns = "urn:schemas-microsoft-com:vml" />