Bush signs housing stimulus bill
Pres. Bush signed the housing stimulus billinto law yesterday. Let’s hope it provides some hope the millions of U.S. homeowners facing foreclosure.
The bill — known as the Housing and Economic Recovery Act of 2008 — is designed t0 let about 400,000 homeowners refinance into affordable government-backed loans. It also offers a temporary tax credit for first-time buyers. The credit will provide $7,500 toward the purchase of a home, and can be used for purchases made from April 9 of this year through July 1 of next.
The bill also includes government assistance for giant mortgage providers Fannie Mae and Freddie Mac, both of whom are facing their own serious financial difficulties.
This bill isn’t perfect, and it won’t nearly help all those homeowners currently struggling to make their mortgage payments. And from what I gather from listening to radio news shows and reading letters to the editor in local newspapers, there are a lot of people out there who resent any kind of government assistance to homeowners who are struggling to make their monthly mortgage payments.
To me, though, this bill, with its imperfections, is still a necessity. Yes, many people facing foreclosure are doing so because they were greedy. They took out adjustable rate mortgages with artificially low initial mortgage payments so that they could get into a home they otherwise would not have been able to afford. But there are just as many, if not more, homeowners facing foreclosure because they’ve lost their jobs in this difficult economy, have become ill or were pressured into a bad mortgage loan by shady loan officers.
We should be helping that last group of people, right?
I’m tired of hearing that those in trouble with mortgages were greedy. We got 5 or 6 calls from mortgage companies every single day asking if we wanted to refinance our home. There were so many of them calling that I finally took my phone off the hook. And I know several young and dumb kids who got talked into sub prime loan with secondary loans. One friend got financed for 250,000 on a house appraised for 135,000. The greed was in the mortgage and real estate companies. In our area, now listed as the poorest in the whole nation, we suddenly had 48 Mexican real estate dealers who connived to sell huge new homes to poor immigrants who didn’t understand the system. since the crash they have all disappeared – turned out they didn’t have licenses. Arrests? No, no, no.
Hi, Clayre:
Thanks for your comments. I, too, am surprised by how many people think everyone who’s in foreclosure deserves what they get. I’m sure some homeowners were greedy. But I’m equally sure many, many more have just been misled by “professionals” who were supposed to have their best interests at heart. I know when my wife and I were applying for a mortgage loan two years ago, our loan officer kept trying to talk us into an interest-only loan. Thankfully, we resisted the temptation.
Dan