Another Foreclosure Prevention Plan

Another Foreclosure Prevention Plan
(Everybody has one)

The FDIC explained what it wants to do:

Although foreclosures are costly to lenders, borrowers and communities, the pace of loan modifications continues to be extremely slow (around 4 percent of seriously delinquent loans each month). It is imperative to provide incentives to achieve a sufficient scale in loan modifications to stem the reductions in housing prices and rising foreclosures.

Modifications should be provided using a systematic and sustainable process. The FDIC has initiated a systematic loan modification program at IndyMac Federal Bank to reduce first lien mortgage payments to as low as 31% of monthly income. Modifications are based on interest rate reductions, extension of term, and principal forbearance. A loss share guarantee on redefaults of modified mortgages can provide the necessary incentive to modify mortgages on a sufficient scale, while leveraging available government funds to affect more mortgages than outright purchases or specific incentives for every modification. The FDIC would be prepared to serve as contractor for Treasury and already has extensive experience in the IndyMac modification process.

Basic Structure and Scope of Proposal

This proposal is designed to promote wider adoption of such a systematic loan modification program:

1. by paying servicers $1,000 to cover expenses for each loan modified according to the required standards; and

2. sharing up to 50% of losses incurred if a modified loan should subsequently re-default

We envision that the program can be applied to the estimated 1.4 million non-GSE mortgage loans that were 60 days or more past due as of June 2008, plus an additional 3 million non-GSE loans that are projected to become delinquent by year-end 2009. Of this total of approximately 4.4 million problem loans, we expect that about half can be modified, resulting in some 2.2 million loan modifications under the plan.

What many believe this really is:
$24.4 billion in welfare to people who deliberately bought more house than they could afford, paid for by us taxpayers who lived within our means. The only thing "aggressive" about this proposal is how aggressively the government would raid our wallets.

Many people have the attitude that the homeowners in trouble should not be helped at all. They feel that since those homeowners in trouble were reckless with decision to purchase a home they should just have to suffer the consequences. After all I purchased a home I could afford. If we help those who were reckless am I not being penalized for being financially prudent? That attitude is all to indicative of what is wrong with our country.
Are you really that blinded by greed and anger? If you're responsible for yourself and your family, why feel such anger and hate towards your neighbor? If 5 houses on your block, or in your neighborhood fall into foreclosure - do you not see that it affects you? That's 5 houses that just depreciated in value - bringing your home value down. That's 5 homeowners not paying taxes - yours will go up next year when the cops/firefighters/garbage pick-up/public workers/water dept..... etc. bill isn't fully funded. That's 5 families that don't shop at the local grocery store anymore. 5 families that don't eat at local restaurants, buy cars at the dealers in town. All of those places that you may be just blindly assigning as 'wasteful' - they also pay taxes to your municipality and State. They are now also going broke, so do the math.

Is it a frustrating situation? Sure. But spewing anger against those less fortunate and suffering does nothing to help the situation. This is a nationwide problem and every American should want it fixed just as soon as possible. Then we all win!

Be blessed,

Wayne

Love all – Trust some – Harm none

www.Capstone-Ministries.org

New economic stimulus plan unveiled

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It looks like someone has finally come up with an economic stimulus plan that might actually work. The federal government has committed over $750 billion for various bailouts mostly to help financial institutions and the executives that caused this economic mess we are in. And as you will know, before they are done that number will be north of a trillion dollars. How much of that will trickle down to the hard working populace that are paying for it? Almost none. It’s a bailout for them, not us.

In the last attempt to stimulate the economy checks of $300 per individual or $600 per family were distributed. Did that help? Well maybe a little, but not very much. What did you do with yours? If you are like me you don’t have any idea.

So… now a plan that might actually help the recovery. This plan was conceived by a non-partisan group of congressmen, and you won’t hear about it elsewhere for days. I have an exclusive.

The Plan
Starting in January 2009 the federal government will grant $1,000,000 to 100 people each day for the first 20 work days of each month. The money will be tax free and distribution will be decided by some sort of lottery system yet to be determined. Each month 2000 people will receive $1,000,000 tax free. That will be 24,000 new millionaires in 2009. The plan will run for 10 years and therefore will result in 240,000 new millionaires and the total plan would have cost the taxpayers $240 billion. That is less than 1/3 what the bailout cost and remember the bailout was for the financial institutions.

There are a few qualifiers to participate in the lottery:
1. Participants may not be younger than 30 or older than 70.
2. Recipients must commit to a minimum of 20 hours per month of meaningful community service. Active military personnel are exempt from this requirement until the end of their active duty term.
3. Participants may never have been convicted of a felony.
4. Recipients must be U.S. Citizens.
5. If a recipient has ever filed bankruptcy the debts discharged must be paid from the $1,000,000 up to a maximum of $500,000.

Just distributing this much money will stimulate the economy, but wait… there’s more! Look at the benefits.

A lot of people will be doing community service… Good for the country.

Some recipients will invest the money… Good for the economy.

Some will start businesses creating jobs… Good for the economy

Some will spend it all on stuff… Also good for the economy

This will no doubt create excitement among citizens… Good for the country.

This plan could also help the U.S. regain it’s rightful spot as a world leader. Other countries may well follow our lead and institute similar programs… and the world’s economy rebounds.

There you have it… pretty sweet huh?

There is one false statement in the above. It is “This plan was conceived by a non-partisan group of congressmen.” This plan is really the brainchild of a guy in Missouri named Eric. My son Eric Weeks owns this one. We are both very interested in feedback as to why this would not work, and why it wouldn’t be better than any economic stimulus proposal or bailout presented so far.

Wayne

Love all… Trust some… Harm none.

www.Capstone-Ministries.org