We spent billions bailing out the banks, and now those banks don't want to write down principal on existing mortgages because they'd have to eat the cost. So instead they take possession of those houses, sell them at a loss, and still eat the cost.

What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

It's maddening.

Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

So.... another bail out then?

Lsherm: We spent billions bailing out the banks, and now those banks don't want to write down principal on existing mortgages because they'd have to eat the cost. So instead they take possession of those houses, sell them at a loss, and still eat the cost.

What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

It's maddening.

Worse than the bailout was the fact that the banks wrecked the economy. Most of the people who are behind on their payments wouldn't be if they hadn't lost their farking job after the derivatives scandal caused the economy to go into recession.

unlikely: Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

So you just want to REWARD people for making bad decisions?!

Oh, wait.

Rapmaster2000: unlikely: Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

So you just want to REWARD people for making bad decisions?!

Oh, wait.


THIS, I'm conflicted between wanting to help people who, out of no fault of their own, lost their job due to the recession and the greedy banks which caused it should suffer a bit. Although what you are telling people who make risky purchases on home loans they shouldn't have qualified for in the first place, a principal reduction. There are outliers, sure, but a lot of people who are underwater couldn't afford their mortgages in the first place (ARMs, 0% down, etc).

There is a reason that usury was illegal for so very long.

Money is a means of exchange, not a product. Only the worst kind of human beings will be drawn to banking. The ancients knew this. Nothing is new under the sun people.

Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

That was the biggest failure of ARRA: it provided a way to get people to renovate and purchase vacant & abandoned foreclosed homes, but did nothing to stop people from getting foreclosed upon in the first place.

This is almost good news. Its just a public statement, but still, Treasury is willing to defend mortgage write downs publicly. The sooner the bad loans clear, the sooner the market can get moving again.

Couple that with the hedge fund sharks looking to buy up foreclosed properties (New Window), we just might be able to see the light at the end of the tunnel soon.

\on this side of the pond anyway
\\EU, BRICs not helping

Spiffy tag? Really?

F*ck him, reward these dumb assholes because they made piss poor choices? We didnt get a $550K house because it wasnt justified after costs and not being able to afford anything else.

Ham Sandvich: This is almost good news. Its just a public statement, but still, Treasury is willing to defend mortgage write downs publicly. The sooner the bad loans clear, the sooner the market can get moving again.

Only if those affected by that are punished in their credit rating, its complete bullshiat that irresponsible people get a free ride.

Both political parties should have their conventions in the heart of neighborhoods ravaged by foreclosures. The riots and subsequent fires will solve the neighborhoods' vacant property problem.

Nosferatu wants to do what now?

Now I just have to hope they do the same for student loans next, then I might actually be able to afford a house one day.

Is that why I can't refi?

Moral hazard?

vpb: Lsherm: We spent billions bailing out the banks, and now those banks don't want to write down principal on existing mortgages because they'd have to eat the cost. So instead they take possession of those houses, sell them at a loss, and still eat the cost.

What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

It's maddening.

Worse than the bailout was the fact that the banks wrecked the economy. Most of the people who are behind on their payments wouldn't be if they hadn't lost their farking job after the derivatives scandal caused the economy to go into recession.

And that covers this whole thread. Good show, chaps. :)

/turns out the lights

steamingpile:

Only if those affected by that are punished in their credit rating, its complete bullshiat that irresponsible people get a free ride.

Are you talking about Citibank?

Oh, Gee. Is it election time already??? Time to pretend we care about the little people.

Let's contrast this with how things have gone over the past four years with little Timmy Geithner.

The former inspector general for the TARP program has publicly spilled the beans:

Government officials, he says, eagerly served Wall Street interests at the public's expense, and regulators were captured by the very industry they were supposed to be regulating. He says he was warned about being too aggressive in his work, lest he jeopardize his future career.

Thus the collision course was set between Mr. Barofsky and a crew of complacent, bank-friendly Treasury officials. He soon discovered that the department's natural stance of marching in lock step with the banks meant that he had to question its policies and programs repeatedly to ensure that taxpayers weren't at risk for fraud and abuse.

"The suspicions that the system is rigged in favor of the largest banks and their elites, so they play by their own set of rules to the disfavor of the taxpayers who funded their bailout, are true," Mr. Barofsky said in an interview last week. "It really happened. These suspicions are valid."

Bailout" covers a lot of ground, running through attempts of the inspector general's office to ensure that additional rescue programs suggested by the Treasury had safeguards in place to avoid conflicts of interest, collusion and fraud. One battle involved the Public-Private Investment Program, designed to get troubled mortgages off banks' balance sheets by encouraging private investors to buy them using mostly taxpayer dollars. When the inspector general's office recommended ways to protect against fraud and to fix other flaws in the program, Mr. Barofsky writes, the Treasury rejected the suggestions, maintaining that they would gut the programs and reduce participation.

Another skirmish involved the department's ill-conceived loan modification plan, known as the Home Affordable Modification Program. When the Treasury began discussing the program's outlines, Mr. Barofsky said he became concerned that it would open the door to fraudulent foreclosure rescue schemes, in which large upfront fees could be extracted from desperate borrowers eager to participate in what was supposed to be a free government program. When his office recommended fraud-prevention measures, several were ignored, he writes.

A few months after the modification plan was announced, his office began a preliminary audit of its rollout. "We soon verified what we had suspected," Mr. Barofsky writes. "Treasury had failed to ensure that the servicers had the necessary infrastructure to support a massive mortgage modification program." It barely got off the ground, and few homeowners have received the help they hoped for.

THIS was just one of many examples from Mr. Barofsky's 16-month tenure, during which, he says, Washington abandoned Main Street while rescuing Wall Street. "There has to be wide-scale acknowledgment that regulatory capture exists, dominates our system and needs to be eradicated," Mr. Barofsky said in the interview. "It was my job to bring as much transparency to taxpayers so they knew what was going on. Writing the book, I tried to bring the same level of transparency so people understand how captured their government has become to the financial interests."

Finally, Mr. Barofsky joins the ranks of those who believe that another crisis is likely because of the failed response to this one. "Incentives are baked into the system to take advantage of it for short-term profit," he said. "The incentives are to cheat, and cheating is profitable because there are no consequences."

It's not just people who bought huge houses while they made $20,000 a year that are underwater. We're underwater on our mortgage simply because home values in our town have dropped so much. The last time the city did an assesment of value, we lost enough to make our house worth less then what we still owe on it. We're up to date on our mortgage, and never miss a payment, but we still owe more then our house is worth, which means we're stuck in it. We'd love to sell and move to something nicer, but we'd never be able to get what we need out of the house we have now.

Yes, some people made stupid decisions, but plenty of people have gotten screwed through no fault of their own.

Starfly: Rapmaster2000: unlikely: Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

So you just want to REWARD people for making bad decisions?!

Oh, wait.


THIS, I'm conflicted between wanting to help people who, out of no fault of their own, lost their job due to the recession and the greedy banks which caused it should suffer a bit. Although what you are telling people who make risky purchases on home loans they shouldn't have qualified for in the first place, a principal reduction. There are outliers, sure, but a lot of people who are underwater couldn't afford their mortgages in the first place (ARMs, 0% down, etc).

according to the FHA, 80% of the borrowers on underwater mortgages are current.

you can read the full report here

Link

the FHA is instead promoting the idea of principal forbearance, rather than an outright handout. from the report:

Principal forbearance, as noted above, would give taxpayers a share in that price appreciation. Principal
forbearance operates in a manner very similar to shared appreciation, except that with forbearance the
investor's share of any appreciation from the current home value is paid first and is capped at the time
of loan modification to the amount of forborne principal. If house prices rise above the forborne amount
the borrower captures all the additional appreciation. Furthermore, principal forbearance does not
require any infrastructure changes for lenders and investors to account for future assets and liabilities,
as does shared appreciation

seems pretty reasonable to me.

unlikely: Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

Same.

dumbobruni: seems pretty reasonable to me.

If we'd started with that, I don't think anyone would have had a problem with it.
Since it's after we've already bailed out the farkers who caused the mess to begin with, no, it's not even remotely reasonable.
It's like sentencing the Aurora Shooter to a gun safety class, paid for by the victims.

Kriegshund: It's not just people who bought huge houses while they made $20,000 a year that are underwater. We're underwater on our mortgage simply because home values in our town have dropped so much. The last time the city did an assesment of value, we lost enough to make our house worth less then what we still owe on it. We're up to date on our mortgage, and never miss a payment, but we still owe more then our house is worth, which means we're stuck in it. We'd love to sell and move to something nicer, but we'd never be able to get what we need out of the house we have now.

Yes, some people made stupid decisions, but plenty of people have gotten screwed through no fault of their own.

Also this. Similar situation. If the house had its current appraised value in 2007, I could probably have bought it outright and never had a mortgage. Our circumstances were such that it made sense to buy at the time. We bought within what we could afford. Never missed a payment. And yet we're underwater because the banks cratered the economy and housing values plummeted. Nice.

Except for GM, Chysler and AIG, the TARP money has been paid back.

Did Wall street help screw this up, you bet. Did the American public help in this, you bet.

Did some people over value their house because " real estate never goes down", you bet.

Did some people drain their equity to buy new cars, boats or vacation houses, you bet.

Empathy for those that lost their jobs and can't make their mortgage payments and lost or are losing their house.

No empathy for those that entered into an agreement to purchase an asset based on their financial situation and their financial situation remains the same but the asset has gone down in value. Well boo farking hoo. Now be an adult and quit whining.

Do you do this whining when you buy more car than you should be or finance it over 72 or 84 months and it is underwater?

We need to clear out these foreclosures, pending foreclosures and short sales to get the housing market and economy going. Until then, its an anchor on the economy. When you look for a write off you are looking for other individuals (investors and owners of banks) to pay for your poor decisions. Suck it up.

To the US Government:

Just for the record, if you DON'T help those of us who were responsible and are still underwater, all bets are off. You've bailed out the banks, the auto companies, student loans, maintained subsidies for big oil, refuse to cut spending in the military, and given a huge revenue stream to the health insurance companies. You have 18 months. After that, I'm walking away from my mortgage and encouraging everyone I know to do the some.

fark you all very much and have a nice day.

Buffalo77: Did Wall street help screw this up, you bet. Did the American public help in this, you bet.

You act as though the blame should be shared equally, even though one side had all of the money and complete control over who they loaned it to.

Flying Code Monkey: Kriegshund: It's not just people who bought huge houses while they made $20,000 a year that are underwater. We're underwater on our mortgage simply because home values in our town have dropped so much. The last time the city did an assesment of value, we lost enough to make our house worth less then what we still owe on it. We're up to date on our mortgage, and never miss a payment, but we still owe more then our house is worth, which means we're stuck in it. We'd love to sell and move to something nicer, but we'd never be able to get what we need out of the house we have now.

Yes, some people made stupid decisions, but plenty of people have gotten screwed through no fault of their own.

Also this. Similar situation. If the house had its current appraised value in 2007, I could probably have bought it outright and never had a mortgage. Our circumstances were such that it made sense to buy at the time. We bought within what we could afford. Never missed a payment. And yet we're underwater because the banks cratered the economy and housing values plummeted. Nice.

Your respective houses were never guaranteed to maintain their value and you both made a long-term commitment to pay them off at the time, so I'm not sure why you feel at all entitled to a write down at the expense of the taxpayer.

Rapmaster2000: steamingpile:

Only if those affected by that are punished in their credit rating, its complete bullshiat that irresponsible people get a free ride.

Are you talking about Citibank?

Punish them then, people who make bad decisions should suffer from them, if you make $35K a year then you cant afford a $200K home, that is just reality.

I have had friends of friends quit talking to me when I didnt agree with their outrage over how they couldnt afford their house now and how it has lost so much value, sorry if I dont show false outrage for contracts you signed when making $65K total between two people but yet you felt the need to sign papers to try and buy a $275K house. Its not my fault they are stupid and refuse to live within the bounds of their reality.

Sergeant Grumbles: dumbobruni: seems pretty reasonable to me.

If we'd started with that, I don't think anyone would have had a problem with it.
Since it's after we've already bailed out the farkers who caused the mess to begin with, no, it's not even remotely reasonable.
It's like sentencing the Aurora Shooter to a gun safety class, paid for by the victims.

the US government took equity stakes in many bailed out banks. The US received dividends on those stakes, and recorded profits on those stakes when the banks repaid their TARP funding.

The government has earned $25.2 billion on its investment of $309 billion in banks and insurance companies, an 8.2 percent return over two years, according to data compiled by Bloomberg. That beat U.S. Treasuries, high-yield savings accounts, money- market funds and certificates of deposit. Investing in the stock market or gold would have paid off better.

Link

Flying Code Monkey: Kriegshund: It's not just people who bought huge houses while they made $20,000 a year that are underwater. We're underwater on our mortgage simply because home values in our town have dropped so much. The last time the city did an assesment of value, we lost enough to make our house worth less then what we still owe on it. We're up to date on our mortgage, and never miss a payment, but we still owe more then our house is worth, which means we're stuck in it. We'd love to sell and move to something nicer, but we'd never be able to get what we need out of the house we have now.

Yes, some people made stupid decisions, but plenty of people have gotten screwed through no fault of their own.

Also this. Similar situation. If the house had its current appraised value in 2007, I could probably have bought it outright and never had a mortgage. Our circumstances were such that it made sense to buy at the time. We bought within what we could afford. Never missed a payment. And yet we're underwater because the banks cratered the economy and housing values plummeted. Nice.

You do realize that is not what happened, right?

Prices only go up because of demand, not anything the banks choose to do.

Around metro atlanta we have people who are apartment or duplex dwellers thinking it would be a good idea to buy a house because some moronic agent is fudging numbers to get them to meet the target of earnings to afford the home, what I will fault the banks on is not watching more closely on what certain arms of their loan offices were doing. But that goes back to relaxed rules on loans back in the 90s to allow more people to buy homes, there have been numerous people calling this bullshiat since early 2000 which is why we stopped investing in real estate.

Blame should go back to the root source and not stop at the banks.

steamingpile: Prices only go up because of demand, not anything the banks choose to do.

This would be true if the banks didn't have 99% control over who was going to buy a house or not. But since the banks won't lend to much of anyone, even people in fairly great shape, demand has dried up. And thus prices go down.

dumbobruni: The government has earned $25.2 billion on its investment of $309 billion in banks and insurance companies, an 8.2 percent return over two years, according to data compiled by Bloomberg. That beat U.S. Treasuries, high-yield savings accounts, money- market funds and certificates of deposit. Investing in the stock market or gold would have paid off better.

And that makes it reasonable because...?

The government saved the banks' bacon. It was great that they came out ahead for doing it, but it doesn't change the fact that the banks massively screwed the pooch and are the main reason people are underwater on the mortgages to begin with.
So no, I really don't think it's reasonable that the homeowners should be held to contracts that necessitated their banks be bailed out, and principle forbearance is just one more sly way the banks are trying to weasel out of responsibility for their mistake.

steamingpile: Blame should go back to the root source and not stop at the banks.

It stops at the farking banks because they had full control over what they did with the money. If Joe the Frycook makes $25K and wants a house loan for $200K, all the bank has to do is say "No." and it ends there.
Had they continued to do that, there would have never been any problem. Instead, they said "Yes." and any, any, any farking statement to the contrary is absolving responsibility from the guilty party.

Lsherm: We spent billions bailing out the banks, and now those banks don't want to write down principal on existing mortgages because they'd have to eat the cost. So instead they take possession of those houses, sell them at a loss, and still eat the cost.

What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

It's maddening.

If only they were doing just that. No, banks have turned to renting out these homes and performing no upkeep at all. If anything they should not be allowed to do two things: 1) Rent 2) Maintain a massive shadow inventory to artificially keep housing prices up.

steamingpile: Rapmaster2000: steamingpile:

Only if those affected by that are punished in their credit rating, its complete bullshiat that irresponsible people get a free ride.

Are you talking about Citibank?

Punish them then, people who make bad decisions should suffer from them, if you make $35K a year then you cant afford a $200K home, that is just reality.

I have had friends of friends quit talking to me when I didnt agree with their outrage over how they couldnt afford their house now and how it has lost so much value, sorry if I dont show false outrage for contracts you signed when making $65K total between two people but yet you felt the need to sign papers to try and buy a $275K house. Its not my fault they are stupid and refuse to live within the bounds of their reality.

There were two halves of that contract. Both halves made the decision to enter that contract based on the false assumption that the value of real estate would always go up. They were both irresponsible. I hope you have enough outrage for everybody.

Kriegshund: It's not just people who bought huge houses while they made $20,000 a year that are underwater. We're underwater on our mortgage simply because home values in our town have dropped so much. The last time the city did an assesment of value, we lost enough to make our house worth less then what we still owe on it. We're up to date on our mortgage, and never miss a payment, but we still owe more then our house is worth, which means we're stuck in it. We'd love to sell and move to something nicer, but we'd never be able to get what we need out of the house we have now.

Yes, some people made stupid decisions, but plenty of people have gotten screwed through no fault of their own.


When the institution that I have a contract with turns out to be involved in what is clearly a ponzi scheme that bankrupts my entire country why in the king fark am I the only party held responsible?

Rapmaster2000: There were two halves of that contract. Both halves made the decision to enter that contract based on the false assumption that the value of real estate would always go up. They were both irresponsible. I hope you have enough outrage for everybody.

But only one of those halves stood to profit either way.

Sergeant Grumbles: dumbobruni: The government has earned $25.2 billion on its investment of $309 billion in banks and insurance companies, an 8.2 percent return over two years, according to data compiled by Bloomberg. That beat U.S. Treasuries, high-yield savings accounts, money- market funds and certificates of deposit. Investing in the stock market or gold would have paid off better.

And that makes it reasonable because...?

The government saved the banks' bacon. It was great that they came out ahead for doing it, but it doesn't change the fact that the banks massively screwed the pooch and are the main reason people are underwater on the mortgages to begin with.
So no, I really don't think it's reasonable that the homeowners should be held to contracts that necessitated their banks be bailed out, and principle forbearance is just one more sly way the banks are trying to weasel out of responsibility for their mistake.

the argument in TFA and the link I posted is NOT about mortgages owned by banks. its about mortgages held by Fannie Mae and Freddie Mac, which are essentially owned by the US taxpayer right now. any losses that Fannie Mae and freddie Mac incur are filled in with further support from the US treasury.

principal forebearance in this case would not benefit banks, but the US taxpayer.

dumbobruni: the argument in TFA and the link I posted is NOT about mortgages owned by banks.

I herped about it to start, and then you derped with TARP. Together we herp derped. Sorry.

I still blame the banks for Fannie and Freddie owning so much toxic debt to begin with, but if we're talking about what benefits the taxpayers the most, I still think writing down the principal is a better way for the taxpayers to give back to themselves what they already own. Principal forbearance seems to still be banking on home prices increasing, even though that's what got us into trouble in the first place, and the market DOES NOT NEED any more artificial price inflation.

Starfly: Rapmaster2000: unlikely: Lsherm: What we spent rescuing Citibank could have paid off all these underwater mortgages across the country.

This is the thing that makes me just nuts.

So you just want to REWARD people for making bad decisions?!

Oh, wait.


THIS, I'm conflicted between wanting to help people who, out of no fault of their own, lost their job due to the recession and the greedy banks which caused it should suffer a bit. Although what you are telling people who make risky purchases on home loans they shouldn't have qualified for in the first place, a principal reduction. There are outliers, sure, but a lot of people who are underwater couldn't afford their mortgages in the first place (ARMs, 0% down, etc).

It is the obligation of salespeople and underwriters to ensure suitability of a financial product. Most people are financially illiterate and unable to make good decisions. We had mortgages in Indianapolis being issued to actual illiterates by lying bastards who sold the mortgages to banks. And then there were the salespeople in model homes who would tell people "The builder requires you to go through them for the mortgage and they only offer ARMs." I heard that from four different reps for different builders. And then they'd proceed to tell you how the mortgage was in fact affordable because "We're such a moblie society, nobody lives in the same house for more than five years anyway. It's a starter home, you will be making more money and be ready to upgrade to a better home anyway."

Lies and outright fraud by frontline workers coupled with lack of financial education (most people I know my age can't even calculate compound interest) led to people making bad decisions. YMMV but that was my experience. I saw nothing but a collapsing market back in 2001. Of course my friends all told me I was just an idiot college dropout, how dare I think I know more than the experts selling the mortgages. Except that there was no licensing, certification or professional liability for direct employees of home builders in Indiana. And they are still exempt from any sort of standard.

The homebuilders screwed the pooch big time. I blame them far more than the ignorant masses who relied on their "expertise" thinking that there was some sort of regulatory system over mortgage origination.

Sergeant Grumbles: dumbobruni: the argument in TFA and the link I posted is NOT about mortgages owned by banks.

I herped about it to start, and then you derped with TARP. Together we herp derped. Sorry.

I still blame the banks for Fannie and Freddie owning so much toxic debt to begin with, but if we're talking about what benefits the taxpayers the most, I still think writing down the principal is a better way for the taxpayers to give back to themselves what they already own. Principal forbearance seems to still be banking on home prices increasing, even though that's what got us into trouble in the first place, and the market DOES NOT NEED any more artificial price inflation.

principal forebearance would still reduce the liability of the debtor to the same levels. it would allow some hope of recovery if home prices rise again.

and in severely hit areas by the housing crisis, such as Phoenix and Miami, prices are recovering.

Link

# U.S. Metro Y-o-Y Percent Change in Asking Price
1 Phoenix, AZ 16.5 percent
2 Miami, FL 14.5 percent
3 Cape Coral--Fort Myers, FL 12.0 percent
4 West Palm Beach, FL 7.5 percent
5 Warren-Troy-Farmington Hills, MI 6.7 percent
6 Pittsburgh, PA 6.3 percent
7 Denver, CO 6.2 percent
8 Detroit, MI 5.3 percent
9 Little Rock, AR 5.1 percent
10 Orlando, FL 4.3 percent

Sergeant Grumbles



Buffalo77: Did Wall street help screw this up, you bet. Did the American public help in this, you bet.

You act as though the blame should be shared equally, even though one side had all of the money and complete control over who they loaned it to.


Oh come on. You are saying the equivalent of fat people saying they are fat because McDonalds advertises.

Here is my story. 5 years ago I was looking for a house to rent. I found one listed by a real estate company. Walk in pay my fee for credit check and told them I was interested in renting the house. Next day I come back, agent tells me my credit is ok but not great. Owner is looking for someone with great credit but if I write a letter telling him about myself and why I like his house, he may rent me the house. Well I did rent from him and he lowered the price. Here is the kicker. Agent says if I want to buy the house I can get financing no problem no money down and owner will sell for 180K. I didn't believe house was worth that much but other houses in neighborhood were selling for that amount.

I passed. I am still in house but moving as I bought another house in different section of town. He offered to sell me house for 130K this year. They tried to get me to buy an overpriced house 5 years ago but they didn't force me. If I had, I would be underwater also. I wouldn't biatch though as I had the option to not buy the house.

You borrowed money to a buy something. You didn't borrow money as a hedge bet against a commodity. When you buy a car, you don't go back to the bank and tell then that you are not paying them back the full amount of the loan because the car lost value.

Houses sometimes gain value, sometimes they loose it. Its called a housing market. Sorry, but to allow people to write down their principles because they bought property at a bad time is just throwing taxpayer's money after bad decisions.

Write off their interest, if need be - that is where banks make their money anyway.

Buffalo77: Oh come on. You are saying the equivalent of fat people saying they are fat because McDonalds advertises.

Wrong. There is nothing even remotely similar about the two situations.
McDonald's is under no obligation to give cheeseburgers to people who can't afford it. A bank is under no obligation to give loans to people who can't afford it.

/Wimpy gladly takes out a 30 year ARM for a hamburger today.

Starfly




THIS, I'm conflicted between wanting to help people who, out of no fault of their own, lost their job due to the recession and the greedy banks which caused it should suffer a bit. Although what you are telling people who make risky purchases on home loans they shouldn't have qualified for in the first place, a principal reduction. There are outliers, sure, but a lot of people who are underwater couldn't afford their mortgages in the first place (ARMs, 0% down, etc).


You aren't remembering correctly. The recession and housing crisis were two different things. The housing crisis/ banking crisis didn't cause the recession. It was the other way around. Recessions happen are normal cyclical events.

Recession happened. There were a great number of people who had bet on the come when they bought a house. Either the price of the house would appreciate or because the economy was growing, they would get a better job and better salary. I remember reading an article about an 24 year old, single, assistant manager at Denny's in San Diego crying about losing her $800K house because she couldn't afford the payment after the ARM adjusted.

No empathy for stupidity.

As mortgages started to go bad, the mortgage back securities went bad and the escalation kept growing. So I put equal blame on Mortgage industry the segments of the American public too stupid to understand what they were getting into.

Buffalo77: So I put equal blame on Mortgage industry the segments of the American public too stupid to understand what they were getting into.

It had nothing at all to do with the mortgage industry intentionally making bad loans, packaging them and tossing them like a hot potato with a big shiny AAA rating, did it? Or does the public share the blame for that, too?

Sergeant Grumbles




Buffalo77: Oh come on. You are saying the equivalent of fat people saying they are fat because McDonalds advertises.

Wrong. There is nothing even remotely similar about the two situations.
McDonald's is under no obligation to give cheeseburgers to people who can't afford it. A bank is under no obligation to give loans to people who can't afford it.

Then I don't understand your point or you are inconsistent in your argument.

You are posting that banks should write off underwater loans because they are responsible for homeowners being underwater. I contend both are responsible and homeowners shouldn't have put themselves in that position.

Now your saying bank aren't obligated to give loans to people who can't afford it.

So you saying please help me from myself, I am a victum of my own carelessness (thats being charitable)

Sergeant Grumbles




Buffalo77: So I put equal blame on Mortgage industry the segments of the American public too stupid to understand what they were getting into.

It had nothing at all to do with the mortgage industry intentionally making bad loans, packaging them and tossing them like a hot potato with a big shiny AAA rating, did it? Or does the public share the blame for that, too?

So what does that have to do with you being underwater

AngryDragon: To the US Government:

Just for the record, if you DON'T help those of us who were responsible and are still underwater, all bets are off. You've bailed out the banks, the auto companies, student loans, maintained subsidies for big oil, refuse to cut spending in the military, and given a huge revenue stream to the health insurance companies. You have 18 months. After that, I'm walking away from my mortgage and encouraging everyone I know to do the some.

fark you all very much and have a nice day.

Enjoy never borrowing money again.

Captain_Ballbeard: Rapmaster2000: There were two halves of that contract. Both halves made the decision to enter that contract based on the false assumption that the value of real estate would always go up. They were both irresponsible. I hope you have enough outrage for everybody.

But only one of those halves stood to profit either way.

So they should be faulted for hedging their bets?