Comments on: Is McCain’s Homeowner Bailout Proposal New?

By: missimpossible

missimpossible — Tue, 14 Oct 2008 23:10:02 +0000

The major difference is McCain’s plan is to buy from banks at current value – you can see the plan on his website – whereas the Obama proposal says buy from banks at a negotiated discount rate. McCain’s plan means the taxpayers would take the hit and the greedy banks would remain whole. Not ok.
I do not agree that the homeowners should be bailed out at all. Because many of us are fiscally responsible and live within our means we should have to bear the burden when others gamble and lose? The real estate market was artificially inflated when investors and buyers artificially created excess demand. Prices went out of control. Now the market is correcting itself so many buyers find themselves underwater. Sad for them, but great news for me who might finally be able to find something decent at an affordable price. If we bail everyone out, the prices will never come down as much as they would if allowed to correct on their own.
The bailout only covers primary residences so we arent bailing out the investors, but what about those living beyond their means? Not just subprime buyers, but those that bought $1M homes on multiple arms… Example – I make $120k a year. I was pre-approved for $725k. I gasped and asked how – since I was hoping for $400k – 3 loans, interest only plus arms with creative financing. My payment was only $2400 a month! I walked away knowing it was a bad idea with loads of risk. If I’d have gone forward I might be in the same boat as others. I didnt. I rent. Now, my tax dollars are going to bail out irresponsible people and the prices may never fall to the point they should.
I say them lose their home and walk away with no impact on their credit rating. They can rent and start over, lesson learned. Banks can sell the homes for whatever the market determines, thus allowing it to correct itself.

By: Murphy

Murphy — Thu, 09 Oct 2008 14:37:41 +0000

Both the Dems and the Repubs admit that our economy is now based on housing inflation. It’s like trying to create wealth out of nothing. People borrow money that they can’t pay back, so the government steps in and bails them out by either borrowing more money, or stealing from taxpayers and investors.

The economics books I have studied state that a nation’s wealth is based on a combination of productivity and natural resources divided by population. Nowhere do they mention that wealth is based on inflation; quite the contrary.

By: Mark Richards

Mark Richards — Wed, 08 Oct 2008 20:00:03 +0000

How about we not keep people in homes they couldn’t afford in the first place. That way real estate comes crashing back down to some sort of reasonable level and those people, like myself, that waited and saved rather than jumping in can go out and buy a house this isn’t overpriced?

By: midtownbh

midtownbh — Wed, 08 Oct 2008 15:53:15 +0000

How about the Hope for Homeowners Act…which was signed into law in July

http://dodd.senate.gov/index.php?q=node/4324

http://www.nydailynews.com/money/2008/07/30/2008-07-30_who_qualifies_for_mortgage_help_and_how_.html

By: nykrindc

nykrindc — Wed, 08 Oct 2008 14:49:15 +0000

Yes you are. McCain proposed $300 billion for purchasing existing mortages, whereas Biden is proposing a renegotiation in Bankruptcy court on the interest rate as well as the mortgage.

By: Sid

Sid — Wed, 08 Oct 2008 14:48:29 +0000

None other that Hillary Clinton proposed this last month:

Let’s Keep People In Their Homes
http://online.wsj.com/article/SB122230767702474045.html

As did Dr. Nouriel Roubini
http://www.swamppolitics.com/news/politics/blog/2008/09/bailout_homeowners_first_exper.html

Rep. Rush Holt spoke of being annoyed that this was stripped out of the original bailout package:
http://thinkprogress.org/2008/10/03/holt-holc/

And the Center for American Progress proposed this back in August
http://www.americanprogress.org/pressroom/statements/2007/08/andrew_bush_mortgage.html

So, no, it is not new.

By: Suzii

Suzii — Wed, 08 Oct 2008 09:06:07 +0000

That bit about the government purchasing the defaulted mortgages seems like a difference.

By: Donklephant » Blog Archive » CBS Snap Debate Poll: Obama 39%, McCain 27%

Wed, 08 Oct 2008 06:18:25 +0000

[...] Is McCainâ€™s Homeowner Bailout Proposal New? [...]

By: redhorse

redhorse — Wed, 08 Oct 2008 04:47:16 +0000

The most glaring difference is Biden’s mention of bankruptcy court. Unless I’m missing a step in the process, it sounds like a homeowner would need to declare bankruptcy to receive reworked terms. McCain seems to insert the gov’t before a homeowner reaches bankruptcy.

Now, the actually mechanics of either plan are mysterious so who knows how this would actually work in practice.

By: kranky kritter

kranky kritter — Wed, 08 Oct 2008 03:18:34 +0000

He said “what we should be doing is…” Biden said that a lot in one way or another, by the way. But Biden isn’t on top of the ticket, he’snot setting policy proposal.To my knowledge, Obama has not said this is something he’s sure he wants to enact. I guess he should have, huh?

Meanwhile, McCain said quite clearly that “I will do this” or words to that effect.There’s a difference. Honestly, who cares whose idea it was? I can guarantee Biden heard someone else say it. It’s not that novel an idea. The part that is novel is that McCain, of the 2 candidates, has explicitly said he’ll do it.