Friday, June 20, 2008


I Am NOT Sorry I Feel This Way...

Can we talk this morning?

Here...grab yourself a cup of coffee or some Orange Juice and pull up a chair.

Try to excuse my rapidly rotating, ever greying, ever balding head, if you will.

While I was taking a break from my "injuneering" work this morning, I wandered over to The Drudge Report and found yet another news story about the US congress debating a "Mortgage Foreclosure Rescue" "measure":

WASHINGTON (AP) - A broad bipartisan coalition supporting a massive foreclosure rescue beat back GOP efforts to gut it Thursday, defying a White House veto threat and quashing a bid to make it victim to revelations about two senators' VIP mortgages.

Administration officials said they oppose the inclusion of $4 billion in the measure to help states buy and rehabilitate foreclosed properties, and a plan to have government-sponsored mortgage giants Fannie Mae (FNM) and Freddie Mac (FRE) pay for the rescue.


Its centerpiece is a foreclosure rescue program in which the Federal Housing Administration would provide $300 billion in new, cheaper mortgages for distressed homeowners who otherwise would be considered too financially risky to qualify for government-insured, fixed-rate loans.

Borrowers would be eligible if their mortgage holders were willing to take a substantial loss and allow them to refinance, and would ultimately have to share with the government a portion of any profits they made from selling or refinancing their properties.

The measure is designed to help hundreds of thousands of borrowers in danger of losing their homes, but it also would benefit mortgage holders by allowing them to avoid costly foreclosures and reclaim some of what they're owed by people facing financial ruin.

Doesn't anyone but me have a problem with our Government spending tax dollars taken from people that worked to earn the money and giving it to people that are too careless or in some cases too stupid to pass one of life's most basic tests--buying and financing a home?

After all, I say that navigating yourself and your family through the mortgage process is actually the "final exam" in the challenge of passing from childhood to becoming an independent adult.

I did it the first time at the age of 25, and I've bought three houses I've lived in since, in addition to numerous other pieces of bare dirt and investment properties.

That said, I will also let you in on a little secret...

I, the current self appointed King of Home Improvement in Eastern Tennessee, nearly lost my third house when my company had a "financial reversal" in the late 1990's and I had to declare bankruptcy both personally and for my corporation.

Using the current political logic, I am wont to ask "Where the heck was the Federal By-God Government of the United States of 'Merica" and the hoards of pandering politicians when MY feet were being held to the fire, two customers owing me six figure sums each were going bankrupt, and the phone wouldn't stop ringing day and night with creditors demanding payment from my depleted bank account?

(cue the sound of the crickets chirping...)

It's since taken me eight years to rebuild my credit after my finances and all my things were flushed down the paper-work crapper. This from a guy that never bounced a check for 19 years with Bank South in Atlanta before my own "perfect financial storm" struck my stern.

All I have to say is that the government didn't come running to MY rescue then, and I don't think that OUR government should be passing new laws and stepping in to rescue people today that like me have a little bad luck, or in most cases have been selfish and just plain SCREWED UP.

After all, using the years since 1985 when I bought my first house as a barometer, who in their right mind could bumble buying a property with our current low mortgage rates enjoyed over the past five or ten years?

...unless they've run out and "let their eyes become bigger than their stomachs" (or is it abodes become bigger than their paychecks?)

My first mortgage was a 9.5% 1/5 adjustable loan, and we bought a little bitty house for $65,000 in that process because that was the most we were comfortable financing. The bank would have given me $100K at the time, but I had a modicum of sense about me and I didn't want to be responsible for paying back ONE HUNDRED THOUSAND DOLLARS on our two earner family income and I didn't expect Uncle Sam to come riding to my rescue if things went awry just because I might have been crazy enough to roll the dice and bet my reputation and my credit on a trophy house.

Trophy houses--that's exactly what this current "mortgage crisis" is about, and the lenders are as guilty as the buyers in my opinion.

That's right, the lenders have more to lose in the current "mortgage crisis" overall than most of the poor beleaguered so called "homeowners" because the lenders are holding in many cases over 95% of the debt while the owners lose the other 5%.

What has happened here is yet another huge banking fraud on the scale of the Clinton Era "Savings & Loan" scandal, in as much as the "originators" of the loans (banks, credit unions, mortgage companies, et. al.) have handed out huge sums of money to marginally qualified (or outright unqualified borrowers) knowing that they can sell said loans to Fannie Mae and Freddy Mac--a.k.a. "the Government", earn all of the fees and income up front, then run away from the mess they've created when the feces strikes the rotating impeller.

I'm tired of seeing news reports showing women holding babies, surrounded by toddlers, lamenting being tossed back to the apartment complexes and trailer parks from whence they came because dear hubby got laid off from his job at the Manure Factory and the mean old mortgage company still expects to receive their monthly loan payment.


That picture is the exception rather than the rule...most of the people wallowing in the current "mortgage crisis" are actually gainfully employed men and women that closed their eyes and rolled the dice on their home value or mortgage terms and today they're finally realizing that they've simply


Stupidity no more deserves having tax dollars thrown at it than does outright fraud.


Taking a big breath...

That will be all...for now

1 comment:

helen said...

I agree Virgil. Things are a mess with property at the moment, and it isn't just the US suffering. The United Kingdom is riding the same roller coaster so-to-speak. I do believe that some people have been genuinely screwed over by poor mortgage advice, but I also think that many have bought it on themselves with excessive spending via loans and credit cards. However the unforeseen rises in fuel, energy and food have increased the problems so much more.