Why should government bail out people in housing crisis?

2

Comments

  • Abookamongstthemany
    Abookamongstthemany Posts: 8,209
    jeffbr wrote:
    I may agree with you but where do you draw the line?

    We bail out farmers.
    We bail out corporations.
    We bail out people who can't afford the babies they make.
    We bail out people who didn't save for their retirement.
    We bail out people who can't keep/get jobs.
    We bail out people who don't have / can't afford healthcare.
    etc...

    Fuck em all?
    Only bail out stupid people (some of these mortgages may fall in this category)?
    Only bail out people who are less fortunate than we are (who's "we"?)?
    Bail out everyone and screw any notion of personal responsibility?

    how about we try to make a healthy balance? A balance between helping those who need it most and encouraging responsibilty and educating people somehow on predatory lending practices. No one wants to lose their home and be in these situations. Mistakes and unexpected circumstances happen and pop out of nowhere.
    If you want to tell people the truth, make them laugh, otherwise they'll kill you.

    Man is least himself when he talks in his own person. Give him a mask, and he will tell you the truth.
    -Oscar Wilde
  • Sludge Factory
    Sludge Factory Posts: 976
    anotherclone wrote:
    totally agree.

    Also, I do know in our state, in January of this year...all mortgage brokers have to be licensed. Why this was not happening in the past, I have no idea? It sure filtered out the riff-raff mortgage brokers and kept the more reliable and forthright ones around. As a result, we are already seeing less of the more shady ones and therefore, better quality loans.

    In some cases I know we hate to say that more government or regulation is the answer...but, complaints are more easily registered and dealt with when there is someone that these mortgage brokers are held accountable to.

    As I mentioned, the whole situation is a clusterfuck. And probably in many cases the regulation or bail out is a case of too little/too late.

    Yeah, it is quite the clusterfuck. I agree that the mortgage brokers should be held accountable somehow, I just feel it is unfortunate that it always falls in the lap of government.
  • slightofjeff
    slightofjeff Posts: 7,762
    jeffbr wrote:
    I may agree with you but where do you draw the line?

    I don't know. But draw it somewhere.
    everybody wants the most they can possibly get
    for the least they could possibly do
  • Jammin909
    Jammin909 Posts: 888
    slightofjeff wrote:
    I don't know. But draw it somewhere.


    If I bought Yahoo stock at $130 and three months later it was at $40, should the govt subsidize my losses?

    People are not going to start being responsible until they realize they will be held accountable for their actions. Ignorance is no excuse. You can google anything and everything, education is a two way street. If you can't afford the internet, go to a public library or a friends house to look up how mortgages work, "life skills", whatever you need...

    I really don't think ANYONE was tricked here. If you are paying a $1000 mortgage on a $500,000 house, you should know it's too good to be true and it is your duty to find out the details and ask questions. The bank is going to want that loan paid off before the year 2089.
    The less you know, the more you believe.
  • pjalive21
    pjalive21 St. Louis, MO Posts: 2,818
    watch Glenn Beck tonight on headline news, he talks about this as the lead story ( i know some of you dont like him, but he at least has been talking about it for over a year now!!!)

    9pm and 12am Eastern time

    by the way we do have to draw a line somewhere or we all will share the burden as some people have said
  • jeffbr
    jeffbr Seattle Posts: 7,177
    cornnifer wrote:
    i have to say i'm somewhat desturbed how some here imply that helping people automatically equals "bailing them out".
    God forbid some of you ever need to be "bailed out".

    Why does "bail out" apply here, but at the same time "helping people" applies to someone who might have made a bad choice in a different situation (like having a child with no way to support it)?

    Just wondering. Just as I am wondering where we draw the line, I'm wondering why you see the 2 terms differently. We're essentially talking having the government give people money because they've gotten themselves into a situation and need help. The only difference to me is connotation, I suppose.

    And if we're just talking about connotation, I think of helping people as something people and charities do freely. When someone is coerced to provide something to another it doesn't feel quite like helping.
    "I'll use the magic word - let's just shut the fuck up, please." EV, 04/13/08
  • Abookamongstthemany
    Abookamongstthemany Posts: 8,209
    jeffbr wrote:
    Why does "bail out" apply here, but at the same time "helping people" applies to someone who might have made a bad choice in a different situation (like having a child with no way to support it)?

    Just wondering. Just as I am wondering where we draw the line, I'm wondering why you see the 2 terms differently. We're essentially talking having the government give people money because they've gotten themselves into a situation and need help. The only difference to me is connotation, I suppose.

    And if we're just talking about connotation, I think of helping people as something people and charities do freely. When someone is coerced to provide something to another it doesn't feel quite like helping.

    Well, if the problem were just fixing itself by charitable means and churches, we wouldn't be having this discussion.

    People are in a bind and are faced with overwhelming odds stacked against them. And other people (not saying you) could care less. Some are only out to make whatever money they can squeeze out of these people and then be on their merry way. And then there's the shoulder shruggers, who want to place all blame on the homeowners and treat their fellow man like some pain in the ass burden. If people all cared for others and did the right thing by each other there would be no need for forced taxes. But unfortunately, this isn't the way it is yet. So we have to rely on leaders(elected officials) to guide us in the right direction to keep our country healthy and citizens protected...which includes helping out the less fortunate(you do agree that it's the right thing to help these people, right?) Only we have a reeeeaaaaaaalllllyyyyy bad habit of electing leaders who don't do the things we think they should so we see the same old problems grow into bigger problems and spawn off new problems. I'm really hoping we, as a nation, wise up sometime soon and stop this trend but it ain't looking too good so far...
    If you want to tell people the truth, make them laugh, otherwise they'll kill you.

    Man is least himself when he talks in his own person. Give him a mask, and he will tell you the truth.
    -Oscar Wilde
  • jeffbr
    jeffbr Seattle Posts: 7,177
    Abookamongstthemany wrote:
    Well, if the problem were just fixing itself by charitable means and churches, we wouldn't be having this discussion.

    I agree. Although it would be interesting to see how much more giving would occur if people had more choice in their giving.
    Abookamongstthemany wrote:
    So we have to rely on leaders(elected officials) to guide us in the right direction to keep our country healthy and citizens protected...which includes helping out the less fortunate(you do agree that it's the right thing to help these people, right?) Only we have a reeeeaaaaaaalllllyyyyy bad habit of electing leaders who don't do the things we think they should so we see the same old problems grow into bigger problems and spawn off new problems. I'm really hoping we, as a nation, wise up sometime soon and stop this trend but it ain't looking too good so far...

    I definitely agree that helping out the less fortunate is the right thing to do. I think there are lots of great ways to do it. I also think that the closer to the problem an entity is, the more efficient and effective they can be in their help. That's why I like local and state help. That's why I almost without fail will be critical of any Federal programs. A bunch of congresscritters in DC have no idea how to best help someone in Homer, Alaska. But the City of Homer probably does. And the State of Alaska may as well. We need to quit relying on this notion of a large, centralized command and control Federal Government and bring the government and the power back to where it belongs, closer to the people. I completely agree with your last 2 sentences.
    "I'll use the magic word - let's just shut the fuck up, please." EV, 04/13/08
  • anotherclone
    anotherclone Posts: 1,688
    cornnifer wrote:
    The average home buyer, however is NOT an escrow officer. Its kind of like how the average medical patient is not a doctor.
    i vividly remember, when my wife and i were looking to buy our humble home. The mortgage loan officer was trying to approve us for way more than what we could truly afford. They kept saying shit about how they base their loan approval upon our current income, blah, blah, and throwing around a bunch of trade terms. Would have just as well been speaking another language. Sure, we could afford the mortgage payment they were suggesting if we chose to avoid other luxuries such as, let me see, FOOD. We could afford the payment if we decided to forgo the HEAT option. i truly believe these loan officers to be predatory in nature. They don't care if the buyer can't make the payments and is forced to foreclose. They couldn't care less.

    I'm not disagreeing that there are predatory lenders or loan officers. Sadly, it is true that a lot of them behave this way. I hate to use the analogy, but sometimes we say that these jokers (loan officers) are "used car salesmen". No offense to any used car sales men, or good loan officers that might be among us. :p At least when you go do buy a used car, you are prepared for crap they spew. For about every 1 good loan officer, there are probably 3 lousy ones.

    No matter what...there are always going to be bad-eggs that want to rip people off. I wonder if a good way to curb that type of activity is to have loan officers somehow be salaried employees rather than commission based? I could be off the mark here totally, but I feel that to make them salaried would take away a lot of the monetary compensation they receive for selling people these cracked loans.

    My job is completely different from a loan officer, I'm kind of on the legal end of the closing. A lot of escrow officers are commission based like a loan officer is. I left a company that was commission based, because I felt that the pay structure wasn't conducive to my being "neutral" to the people involved in the closings. It goes without saying, that if you are being paid a commission, you have greater incentive to get a deal closed (you get paid a lot at once) than if you are a salaried employee (you might get paid less, but get paid regardless of your closing).

    I felt kind of more cut-throat about getting deals closed as a commission employee. If that makes any sense. Sure, I make less money now, but I feel like I gained a little more integrity because of it.

    I know we have at least one loan officer among us here...I wonder what they think about all of this.
  • JOEJOEJOE
    JOEJOEJOE Posts: 10,829
    anotherclone wrote:
    I am an escrow officer and I really get annoyed when people say these people didin't know what they were getting themselves into. They sign the closing papers and agree to the terms. All of the terms are explained to them at least once. Usually twice. Things like balloon payments and rate adjustments are clearly noted on the documents.

    If for some reason they do not obtain more than one estimate from more than one lender before committing to a specific loan, they have no one to blame but themselves. Its called "shopping around for the best deal". Most people are familiar with this process when they do something like buy a car, or buying new sneakers. Or maybe you only have $10 in your pocket, so you forego the microbrew and go for something domestic instead. You shop around and get the best deal.

    I do see both sides of the issue though, a lot of people just are not very educated on the process. When they come to closing, they are so excited, they just want the keys to their new dream house and really care very little about anything else. In that regard, I think these folks need to have a little personal ownership of their own failings.

    From my perspective, this problem arose when the industry allowed "zero" down loans. People that couldn't save anything for a down payment, were already one paycheck away from disaster. Basically, they looked at it like "well, its about what I pay for rent, so I can afford this mortgage payment", but the reality of homeownership was something they did not even consider. Things like repairs or annual increases for property taxes. Or what would happen if the economy took a dive and they lost their jobs.

    I'm not sure about NOT bailing these people out though, if the banks do foreclose, banks lose money...and the rest of us shoulder the burden by paying higher fees and interest rates when we want our mortgage loans.

    In short, its just a clusterfuck.

    Buying a house is almost as emotional as buying a Pearl Jam ticket for a show in a far-away city....it sounds good when you do it, but once reality sets in, you realize you can't afford the associated costs!
  • Abookamongstthemany
    Abookamongstthemany Posts: 8,209
    jeffbr wrote:
    I agree. Although it would be interesting to see how much more giving would occur if people had more choice in their giving.



    I definitely agree that helping out the less fortunate is the right thing to do. I think there are lots of great ways to do it. I also think that the closer to the problem an entity is, the more efficient and effective they can be in their help. That's why I like local and state help. That's why I almost without fail will be critical of any Federal programs. A bunch of congresscritters in DC have no idea how to best help someone in Homer, Alaska. But the City of Homer probably does. And the State of Alaska may as well. We need to quit relying on this notion of a large, centralized command and control Federal Government and bring the government and the power back to where it belongs, closer to the people. I completely agree with your last 2 sentences.


    I hear you about centralized gov't but I am weary of state's power, also. I see how more local officials can represent the needs of their people better...in theory. But I live in SC and there's already a lot here that I can not stand. What happens in states like mine on abortion, social programs, environmental regulations?...it goes on and on. What if people are left stranded and unprotected by ineffectual state gov'ts?
    If you want to tell people the truth, make them laugh, otherwise they'll kill you.

    Man is least himself when he talks in his own person. Give him a mask, and he will tell you the truth.
    -Oscar Wilde
  • even flow?
    even flow? Posts: 8,066
    I'd like to get bailed out of my credit card balance. :rolleyes:


    Everybody has to shoulder the blame. From the people who lend others money knowing that they can't afford it, to the people borrowing too much money and not having a peek into the future. Yet the government looks pretty stupid aiding a bank and turning the other cheek on the people.

    I personally don't think the bank or the people should get bailed out. Claim bankruptcy and start all over again.
    You've changed your place in this world!
  • puremagic
    puremagic Posts: 1,907
    If the government can subsidize J.P. Morgan's bailout of Bear Stearns, while J.P. Morgan was bidding over 1 billion dollars under its (One Equity firm) against India's Tata Motors to take over Ford's Jaguar and Land Rover division, then why shouldn't some type of pressure be put on banks to "assist" people. For christsakes the brokerage firms of Goldman Sachs, Morgan Stanley and HSBC negotiated for Tata & Sons. I realize India is the new poster child on the economic block and I know this is what brokerage firms do, but damn, they are large part of this economic mess and any government assistance to this firms should be complimented with some small crumbs to the public. As a stockholder, I'm all for profits, as a citizen, I know my limitations and bailouts are shortfalls to the general public, not the companies.

    Buying with adjustable mortgage rates under Bush was a good move if you switched by 2003. By 2004 there is no way you did not see your property value and property taxes skyrocketing. You had to see the interest rates on your credit cards going up, these are indications. Bush kept personal taxes downs and supplemented families with personal tax credits, this allowed to make payments without "thinking" about the interest rates. The States don't have that luxury, what Bush gave you, he took from the States, forcing the States to raise property taxes and taxes across the board.

    Claiming bankruptcy under this economic climate, will be hit and miss because your home is more valuable than you. Just keep in mind that negotiating to stop foreclosure with a smaller payment will cost you in your interest rate, but whatever you do, don't go for an adjustable rate-to-fixed rate to your stop foreclosure. There are so many housing scams, even with time-honored banks, so be careful.

    If the government wants to truly assist people struggling with their mortgages, they will allow them to refinance at a fixed lower rate with minimum penalties, anything else and your in the same boat.

    Whether its a democrat or republican, taxes and interest rates are eventually going to have to increase.
    SIN EATERS--We take the moral excrement we find in this equation and we bury it down deep inside of us so that the rest of our case can stay pure. That is the job. We are morally indefensible and absolutely necessary.
  • cornnifer
    cornnifer Posts: 2,130
    jeffbr wrote:
    Why does "bail out" apply here, but at the same time "helping people" applies to someone who might have made a bad choice in a different situation (like having a child with no way to support it)?

    Just wondering. Just as I am wondering where we draw the line, I'm wondering why you see the 2 terms differently. We're essentially talking having the government give people money because they've gotten themselves into a situation and need help. The only difference to me is connotation, I suppose.

    And if we're just talking about connotation, I think of helping people as something people and charities do freely. When someone is coerced to provide something to another it doesn't feel quite like helping.

    It is the connotation. Call me a dork if you would like to, i'm fine wit that, but, i like words and their connotation really resonates with me. Help has a very positive connotation whereas "bail out" has a rather negative one. You "bail" people out of jail.
    "When all your friends and sedatives mean well but make it worse... better find yourself a place to level out."
  • jeffbr
    jeffbr Seattle Posts: 7,177
    cornnifer wrote:
    It is the connotation. Call me a dork if you would like to, i'm fine wit that, but, i like words and their connotation really resonates with me. Help has a very positive connotation whereas "bail out" has a rather negative one. You "bail" people out of jail.

    I don't think you're a dork and didn't mean to imply anything like that in my post.

    I agree that bail out has a more negative connotation, but to me, with government involved in the giving, it means that they've also been involved in a taking. That's where the negative comes in. Again, I am happy to freely give and I enjoy helping people and causes. But I don't enjoy having things taken from me by force and given to others and somehow have that construed to be positive.
    "I'll use the magic word - let's just shut the fuck up, please." EV, 04/13/08
  • puremagic
    puremagic Posts: 1,907
    jeffbr wrote:
    Why does "bail out" apply here, but at the same time "helping people" applies to someone who might have made a bad choice in a different situation (like having a child with no way to support it)?

    Just wondering. Just as I am wondering where we draw the line, I'm wondering why you see the 2 terms differently. We're essentially talking having the government give people money because they've gotten themselves into a situation and need help. The only difference to me is connotation, I suppose.

    And if we're just talking about connotation, I think of helping people as something people and charities do freely. When someone is coerced to provide something to another it doesn't feel quite like helping.


    Assisting or helping people out in this economic home crisis is not issuing them a blank check, nor is it absolving them of their responsibility for payments. People took risk because the economy was right, the rates were steady and the tax cuts kept coming, that's the American way, right. Anyone seeking a home would have been a fool not to go for it.

    What's the cost of supporting a homeless family vs allowing them to make smaller mortgage payments with a smaller interest rate over a longer period of time? What's the cost to the community of vacant houses - developers, lower property value, blight, etc. etc. What's the price to the State, lower income generating status, cut in public services, higher taxes, bad roads, etc. What's the cost to the remaining community taxpayers, all of the above, plus higher prices by transportation services, food, gas, electric, water, etc. so as the responsible taxpayer, you're still caught in the home crisis mess because you've now assumed the burden of paying for you, your family and the families that lost their homes, while the lenders receive a true bailout to restructure their business and profit.

    I do agree with you that we have to draw the line when people, who have choices, make the wrong choice, it should not become our burden to bear.
    SIN EATERS--We take the moral excrement we find in this equation and we bury it down deep inside of us so that the rest of our case can stay pure. That is the job. We are morally indefensible and absolutely necessary.
  • eekamouse
    eekamouse Posts: 267
    This whole thing is a complete pile of fucking oyster shit.

    I bought a house in 2006. I didn't get suckered into any variable balloon bullshit. I'm not fucking stupid like the rest of America, I guess.

    However. Fuck these pricks and their banks and their fucking suits.

    I would also like a lower fixed rate than the one I already have. Fuck this. Why not a fucking 3% rate for me just like those fucking big banker fucks get?

    They will still rake in billions.

    Bitches.
    Love is more important to me than faith.
  • meme
    meme Posts: 4,695
    yoke wrote:
    The government has no business bailing these people out. Sorry, but you took a risk and it didn't pay off. I have two friends that are in the situation and they know they screwed up.

    plus the money comes out of our pockets to bail them out

    Or the banks' pockets, if they enforce fixed interest rates for a while.
    ... and the will to show I will always be better than before.
  • Flannel Shirt
    Flannel Shirt Posts: 1,021
    The whole "comes out of our pockets" thing confuses me. How? The money has already been paid. You paid your taxes, they're gone. I havent heard where taxes are going to be raised specifically for a program that will help these people?

    Shit man, my U.S. government came up with billions (is it trillions now?) of dollars on the spot for a war, regardless of how you feel about it, but we cant come up with some money to help these people KEEP THEIR HOMES? Like i said before, lets find a way to make sure everyone benefits. No free rides. But not being jerkoffs and watching people suffer either. People get the relief they need to get back on track, and they have to pay the govt back when able...via tax returns being kept or payment plans or leins on their homes, etc.

    These people have kids, babies, their mothers and fathers in old age living with them, etc. These homes being lost are in the neighborhoosds where parents thought their kids would go to school and play and grow up. The majority are first time home owners, finally reaching the american dream of home ownership, possibly the first home owner in their family history, only to have their credit ruined, their house forclosed, and then what? Many landlords doing credit checks now wont rent them an apartment?

    Its sad that just because someone fucked up, and "they should have known better", they cannot get help. Thats what I have read in here over and over. They fucked up so fuck them. Yeah, thats nice.

    At the end of the day, if my taxes need to go up 10-20 bucks a week to help 2 million people keep their home, so be it. I am for it.
    All that's sacred, comes from youth....dedications, naive and true.
  • cornnifer
    cornnifer Posts: 2,130
    jeffbr wrote:

    I agree that bail out has a more negative connotation, but to me, with government involved in the giving, it means that they've also been involved in a taking. That's where the negative comes in. Again, I am happy to freely give and I enjoy helping people and causes. But I don't enjoy having things taken from me by force and given to others and somehow have that construed to be positive.


    They're already taking it from you. They're taking it from you and spending it on war, bridges to nowhere, and there own frivolous whims. Personally, i'd rather it be spent on what i choose to call "help" to those that desperately need it.
    The individual charitable donation argument sounds nice, utopian, and altruistic, but there is a huge, fat, hairy, Jeff Goldblum sized fly in that ointment. It won't happen on a scale large enough. Never. The middle class is all but gone. The middle clas are the ones living paycheck to paycheck and barely making the ends meet. All this personal charity you speak of would have to come from te stinking rich anyway, and you know as well as i do that just aint happenin'. Te stinking rich didn't get that way by giving shit away. They are much more skilled at, and feel much more in their element when taking. It is no surprise it is the stinking rich who are most opposed to social programs like what were discussing.
    "When all your friends and sedatives mean well but make it worse... better find yourself a place to level out."

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