Super ‘Bama

You have to give President Obama credit for tackling the immediate problems of our nations economy head on and one by one. It’s almost like he has a play book and the toughest issues are at the top of the list of plays. The stimulus plan for the people and getting the jobs back is now in place to start rebuilding our infrastructure with some states receiving from $6 Billion or more over the next two years to rebuild roads, bridges and more.

President Obama is now tackling the home foreclosure problem and according to this report in the New York Times he doesn’t need the Congress to get this mega issue in the “Done” column of his to do list. As a moderate voter, I’m loving his style and desire to fix this nation pronto!

Obama Unveils $75 Billion Plan to Fight Home Foreclosures

By SHERYL GAY STOLBERG and EDMUND L. ANDREWS
Published: February 18, 2009

MESA, Ariz. — President Obama pledged on Wednesday to help as many as nine million American homeowners refinance their mortgages or avert foreclosure, an initiative he said would shore up distressed housing prices, stabilize neighborhoods and slow a downward spiral that he said was “unraveling homeownership, the middle class, and the American Dream itself.”

Mortgage Rate Snippet

“It will not help speculators who took risky bets on a rising market and bought homes not to live in but to sell,” he said, adding, “And it will not reward folks who bought homes they knew from the beginning they would never be able to afford.”

The plan will take effect March 4, when the administration publishes detailed rules explaining it. Most of the plan can be enacted by Mr. Obama though his executive powers, although part of it — including changing the bankruptcy laws to allow homeowners to seek changes to their mortgages through bankruptcy proceedings — will require legislation. Mr. Geithner said the administration was already in discussions with lawmakers on how to proceed. - New York Times

Not since the days of Ronald Reagan and FDR have we seen a President so intent on tackling the problems of our nation with such vigor and vigilance. Mark your calendars and note that I will proudly predict that President Obama will turn this economy around in two years by being proactive and over zealous in his mission. And if he can rescue six million home owners from loosing their homes, he will have a built in re-election vote built into the process. MSNBC has this to say in this news video...

Video Link

Visit msnbc.com for Breaking News, World News, and News about the Economy

If there are 120 million home owners and 6 million of them benefit from his mortgage crisis plan then that is five percent of all homeowners that can thank President Barack Obama for saving their family homestead. Add that total to the number of small business owners that just benefited from the tax cuts in the stimulus package and you have a growing base of voters that will no longer look at the President as the Anti Christ Democrat in the White House.

No matter what angle you look at it, Super ‘Bama is playing the political game of chess like a true leader and his actions are not pissing off his base in any form or sense of the word. Republicans on the other hand have a President that is and will make them look like fools for voting “NO” on every proposal he offers to get America back on track. Republicans will have to explain the actions they took against the President that worked to save jobs, homes and all the rest of the Super 'Bama initiatives at the polls in the next election cycle.

Papamoka

*****Yahoo News has linked in on Business Blogged

Housing Bubble Burst!

With the never ending boom in housing foreclosures comes the reality of what the biggest players in the bust did wrong or were victim of. Owning a home is the biggest goal of every up and coming generation and the market that served that dream ripped many of those same people off. While the President gave the green light to lenders to have a “Free Market” he also enabled them to run wild without care as to whom would get burned down the road.

Buying a home knows no political philosophy when the lender tells you can afford the mortgage. Provided you do not plan to eat in five or so years. Small print, really small print.

The mortgage industry has become a process the application production line and the ones that have to face the music are the people that were just passed on through the process. Raise your hand if you know five or more people that you for one know should never have qualified for a home loan?

With the enticement of home ownership, the lenders sold the people a bag of goods with a self destruct button on it several years later. Over at MSNBC they have this piece on the victims great loan options for capturing the American dream…

The plain old adjustable-rate mortgage spells trouble enough. But three high-risk loans are causing most of the trouble:

Teaser ARM. This loan features an alluring initial period of very low interest, around 1% to 2%, which later resets to market rates. About 1.4 million borrowers will be jolted back to reality in the next two to three years as their introductory periods expire. Payments on a $200,000 loan at 2% are about $725 a month; at 7%, they're $1,340.

Subprime ARM. Nearly half of loans due to reset are aimed at low-income people, minorities and people with bad credit -- folks who can't or just assume they can't get a bank loan at a reasonable rate. Many are in a shaky financial position to begin with and so are in greater danger of defaulting. Subprime (also called nonprime) ARMs start high -- 7% or more -- and go higher. And higher. They often feature a fixed, lower-rate introductory period. But when that ends, it's "just the old-fashioned squeezarooni," Cagan says.

Option ARM. This is the real killer. It gives homeowners the choice each month of paying the principal and interest, just the interest or an even-smaller minimum amount. Every month you pay the minimum, you're deeper and deeper in the red. And up to 80% of option-ARM buyers pay only the minimum, according to Fitch Ratings. Because the minimum payment doesn't cover the monthly interest, the deferred interest is added to the loan balance. After the loan balance grows to a certain point, the lender will demand that you start paying the full principal and interest -- on your now-bigger loan. - MSNBC

This is not a case of predatory lending by any sense of the word. This is a case of corporate gluttony. Make the quickest amount of cash as fast and furious as you can and let the people holding the loans worry about it later. Well, it seems as if the people holding the bag later is us. How does an economy survive when the fundamental basis of the economy is housing and that goes bust?

You can not by any means blame the borrowers of all of the snake oil options that the lending industry presented to them. Our government looked the other way. Our leaders looked the other way because a dollar was to be made by friends of friends and the checks cleared over at campaign headquarters. Tom Delay and Nancy Pelosi are just as guilty in this crisis because nobody said boo! Neither of them will here your screams for help when you loose your house to the jacked up call of your loans terms.

I’m sure that you have heard or seen the radio commercials where President Bush has authorized the refinancing of your loan if it met certain terms. Think again, if you could not afford the house to begin with, could you afford it now with a refinance?

Isn’t politics wonderful. They cut your throat and make you look forward to cleaning up the blood.

Papamoka

Cross posted at Bring IT ON!

Bush-O-Nomics Busted

Picture courtesy of The White House

It isn’t a huge surprise to me that the current trend in home foreclosures is happening given the fact that the lending industry has been left to its own unregulated ways. While President Bush and his crew are waving shiney objects to hide everything they are doing illegally the lending industry is following the same path.

Our nations lending system is broken and it is their own damn fault. Now it is all of our problem as the foreclosure rates go super nova. Welcome back to the Savings and Loan problems of the Reagan era.

I’m not surprised that this dilemma is happening now and neither should the Bush administration. While he has focused most of his limited attention capabilities on the wars in Iraq and Afghanistan the kids are playing at home and ruining the company store. While the lending industry is loaning out the money as fast as the closing points will rack up the President and his hands off policy has played out. Does it make sense to anyone that you can pay an interest only loan for the first five or ten years and then it jumps up to out of your budget world? Busted!

Over at the LA Times they have this incredible story on homeowners in California being foreclosed in triple digit percentages…

Home foreclosures hit record in California

Riverside County at a new high. In addition, there's a year's supply of houses on the market in Riverside and San Bernardino counties, up from a three-week supply at the height of the boom.

By David Streitfeld, Times Staff Writer11:23 AM PDT, July 24, 2007

A sagging real estate market and tighter lending standards are exacting a rapidly growing toll on Californians, forcing them from their homes in record numbers, figures released today show.

Foreclosures in the state during the second quarter totaled 17,408, up 799% from the same period last year. The current rate handily eclipsed the previous foreclosure peak set in 1996, when the state was in the final throes of six-year slump.

The two eras are sharply different.Back then, the primary culprit was massive defense cutbacks that led to high unemployment. Without a paycheck, people couldn't pay the mortgage.This time, the economy is generally sound but many people have become trapped in loans that are resetting to rates that exceed their ability to pay. Those excesses need time to make their way through the system. - Los Angeles Times

Now will come the wave of former homeowners that realistically never qualified for home loans and yet one lending institution after another collected the profits from writing the loans. Those poorly written loans were sold to the highest bidder and guess who is the highest bidder? Yup, our good government providing the cash for all these corrupt lenders. Soon the government will have to bail out the lending industry for stealing from the people and the Bush circle of home finance is complete. More of your money will go into the Bush funnel of friends to pay the people that actually created the American foreclosure scandal.

Just like we are not getting screwed over at the gas pump, you as the former home owner are not really losing your home. It was just a temporary rental agreement courtesy of just another industry where big money protects big money and you end up homeless. American Tax payers will bail out the lenders but you are ultimately screwed. Thanks W!

Papamoka