For awhile I was beginning to fall for this “we must do something” line. After getting the gist of the bill and reading some of the fine print…I find out it’s not only scary beyond belief, it’s bordering on immoral.
I think perhaps the section that scares me the most is this:
GENERAL.—To the extent that the Federal property manager holds, owns, or controls mortgages, mortgage backed securities, and other assets ecured by residential real estate, including multifamily housing, the Federal property manager shall implement a plan that seeks to maximize assistance for homeowners and use its authority to encourage the servicers of the underlying mortgages, and considering net present value to the taxpayer, to take advantage of the HOPE for Homeowners Program under section 257 of the National Housing Act or other available programs to minimize foreclosures.
(2) MODIFICATIONS.—In the case of a residential mortgage loan, modifications made under paragraph (1) may include—
(A) reduction in interest rates;
(B) reduction of loan principal; and
(C) other similar modifications.
So…now the government, especially if we’re dealing with those more irresponsible among us, can arbitrarily drive down principal on “distressed mortgages”. So the guy living next to me gets a hand out because he signed a paper promising to pay what he couldn’t…while I continue to make my payments on time and watch my own home value decrease because the government is now determining market value…nice.
Great stuff guys. Michelle Malkin shows the devil in the details here. Hat tip for the extensive overtime work.
To be honest, I’m nervous about a bailout and nervous about the lack of one too. But if they do one, I am beginning think they should NOT do this particular one.
