They will NOT cut the principal amount owed on the homes, as McCain had stupidly, illegally and unethically wanted to do. The only time you'll see the principal cut is when the homedebtor turns in the keys and the bank puts it out at the new market price.
But the government will offer to refinance every mortgage in America, for principal residences. Multiple-homedebtor/flippers are on their own. Only one per family. And the loan will be audited against the original to make sure fraudsters are not eligible as well.
Why? Because eventually at this rate of decline a majority of Americans will owe more on their homes than they are worth, and will be strongly motivated to just walk away.
The key to avoiding financial Armageddon is to offer a program to convince them that they should not turn in the keys, like what FDR did in '33.
To do that, the government is going to have to make it attractive to stay. So the loan terms will be below-market, and long. The key is to cut the monthly payment, since that's all the sheeple really care about. And the sheeple need to be convinced that it's in their long-term economic interest to stay, and to keep making payments on their debt-trap.
Here's what I think will be offered. It's quite simple actually:
Up to 120% of current appraised value (no cash-back!), 4% 40 year fixed, with the government getting 20% of any profit whenever the home is sold.
The payment on a $200,000 house at 4%/40 is $836 FYI. Which after expenses makes it close to what the home could be rented for in most markets. And government bond rates on 30 year T-bills are at 4% today anyway, so might as well take it from US citizens instead of just China.
That might do the trick and stop more from turning in the keys. And the millions of unwanted homes currently on the market from banks, builders and desperate homedebtors will also be offered at the same terms.
Housing crash over. Prices down significantly, but crash over.
Have at it.
Posts
43 comments:
You for Secretary of Housing.
And with this government program, the thousands of out-of-work mortgage processors and title clerks will get jobs. And the overpaid realtors and loan officers will be cut out of the deals.
Sounds great to me.
no. i think the government will pay the difference between the new loan and the original amount due. then put a lien against the property for that amount. The banks are not going to go for taking an immediate loss an the difference. the financial industry has enough players in high level government to ensure that doesn't happen (see rohm emanual).
Time for DOLLARPanic.com
Sure Uncle Sugar SHOULD help them out. FIRST, send an inspector to insure that ALL Granite, Stainless, Jetted Tubs, and Bonus Rooms are ripped out and disposed of. Any rooms "excess" to the family's actual needs should have the doors nailed shut, or require them to take in homeless people. Any garages in excess of two car, must be used for storage of highway construction signs or road chat. Swimming pools MUST be filled in and sodded lawns must be dug up. If the homedebtor still wants to live there, then bail em out!!! They can watch the inspection on their 60" flat screens like they do when the Realtwhore comes to inspect on "Designed to Sell" (HGTV).
My 1st thought is always how are we going to implement any plan that requires individual assessment of millions of loans?
But this could actually work if rolled out like a FEMA (well, an ideal) response. This would also create temp jobs and spur the economy.
How to work it: Gov. leases space in several regions of a state for 6 mos. Hires and screens a few hundred people to be cust service reps, processors, UW’s, etc. and compiles a list of approved appraisers that are engaged on a random & rotating basis. From start to finish a loan mod should take 2 to 4 weeks. This could easily provide the required manpower for processing thousands of mods in a short time at each location.
In my area, a good majority of short sales are at the low end of the pricing, tho we do have some in the $700K-$1 M+ range. In addition to the 1-per family rule, eligibility should be restricted to owners of non-luxury props, with no other valuable assets. Initial screening will weed out those that could never afford the house they are in at any rate, as well as the frauds, and the well-to-do cheats.
Over? Over????
Define over...
Over easy
Over light
Over and Out
Over the river and thru the woods?
Keith...you are OVER 2 years early on this call. Wait for +12% unemployment. Wait for DOW <6000.
Wait for mortgage rates 9%+. Wait for California & New York insolvency calls. (Can't wait for New Jersey!) Wait for GM & Ford Bankruptcy. It'll really get rolling after Christmas.
The housing crash ain't OVER 'till it's OVER.
Well, .gov needs to STOP raising property taxes or it will not do any good, imo.
The key will be getting an accurate appraisal. Since appraisers on the take were what helped get us into this mess, I'm not sure what the solution is.
Zillow?
What are you saying? That now it's okay for the gubmint to do this just because Obama is at the helm?
I like it Keith, how about up to 80% of the purchase price? Banks recoup or take a hit on the rest.
What the new president will do to keep people in homes and improve housing
Crackdown on mortgage fraud.
The next president wants to increase funding for federal and state law enforcement programs to crack down on mortgage fraud, create new criminal penalties for mortgage professionals guilty of fraud and require "industry insiders" to report suspicious activity, according to his campaign Web site.
Obama claims his Stop Fraud Act will provide the first federal definition of mortgage fraud.
Take a $250,000 house that is now worth $200,000. Pretty standard.
120% of current 200k appraisal is $240k. So someone's $10k short.
The government loans out the $200k. The homedebtor owes the bank or CDO holder close to $250k.
That's up to them to work out.
Oh, one more thing. You only get the 4% 40 on a new home purchase if you DON'T use a realtor.
Oh, man, that would be amazing.
The appraisal fraud was largely connected to the POS Whore Appraiser that was in with a POS Whore Mortgage Broker. A lot of these POS’s can no longer make a legit living at it anymore, and are falling by the wayside.
1. Screen appraisers for prior proven or alleged fraud.
2. It MUST NOT BE any appraiser that valued property in past.
Zillow? Are you crazy? Their info is based on all the shit fraud appraisals done during the boom. On-the-ground local appraisers are the only way to credible market values at this point.
I also hear that all of these gubmint loans will become "recourse" loans.
Debt = slavery
I hate the proposal you offered Keith, but in good spirit with it, lets add the following provisions:
1) Realtor commission total to be limied to 3.5% or a fixed dollar amount
2) All title, closing, and appraisal fees to be competitively priced AND disclosed upfront
3) Limit home profit exclusion of 250K per individual and 500K per person to just once per lifetime
4) Tax credit given based on increasing your credit score. This gives incentives for people to reduce their consumer debt.
Have at it...
PS to my anon @ 7:26
Fan/Freddy has the info/stats on appraisers and mort brokers as to the # of loans they have been involved in that have gone belly up, involve fraud, etc.
Now that we the people owe said entities - it is time that info is not only open to US the public but ACTED ON as well.
Dean Baker at prospect.org floated a proposal about a year ago called the Own to Rent program. Just have the bank rent the damn house to the foreclosee's for fair market value, while they wait for things to stabilize. Yes the bank takes the loss between the mortgage payment and fair value rent. Too bad. Maybe they will be a little more discriminating next time.
The house does not stand empty, the bank collects fair market rent on the unit, and the Owner can still pretend that he really does own all of the upgrades and the neighbors will never know.
It also does not require a single dime of taxpayer money.
Occam's Razor:
"All other things being equal, the simplest solution is the best."
A little late to the Game, It's called Job Losses
The problem is that most people do not understand that money has four fundamental uses:
a store of value,
a medium of exchange,
a unit of account,
a standard of payment.
( see http://en.wikipedia.org/wiki/Money )
What has been forgotten by many ( maybe most ) is that the store of value is the most important use of money and one ignored at our peril.
And the fundamental measure of money's value is the labor required to create a product.
( Think it through. )
The fundamental problem in the housing crisis is that for many people the store of value of their house is far less than the medium of payment value!
Having built my house as an owner / builder, I am intimately familiar with the value of a house like mine ( 3/2/2 ).
I stared in slack jawed amazement just after I built my Florida home in 2002 as people went nuts and started paying 2 - 3 times what I knew that their houses were worth.
I had people knock on my door and offer me double what I spent to build my house!
Now, if these foolish people had utilized their value stored money ( savings ) to buy these houses, then there would be no problem for you and me.
But instead, they found some other foolish people who offered to give them some unit of account money ( some 0s and 1s inside a computer ) in return for a contractual committment to pay them back with money derived from their future labor - plus interest - on 100% of the medium of exchange price of the house!
The lenders ( bankers ) created the accounting money out of thin air ( with a little help from the FED ) and treated it like it had value ( which it did not. )
Now these two groups of foolish people have finally realized what the monitary value of the houses in their monitary exchange actually is. ( I think that the lenders are more at fault here, since it was their job to know value. )
But neither the borrowers - nor the lenders - now want to own the houses at their real value! They want to "settle up" the accounts - but using someone else's money ( that - that would be me. )
I worked hard, produced a useful product ( computer programs ), lived within my means, raised and educated my children and saved for my retirement.
And now I am being targeted by these foolish people in their private transactions. This is wrong.
I am being told I was the fool for saving and not spending my children's future income. And I will be further made the fool by seeing my savings eroded by the inflation of the accounting money at the expense of the stored value of money.
Maybe I should go buy some gold.
don't care if they stretch out the terms. if sheeple get 4% though, no way will others who were responsible go for anything more, unless housing prices are really low.
OK, a plan like below might work .
Say you got a 300k purchase price and the value has gone down to 200k
in the neighborhood .
You give the borrower a government bail out of a 200k first trust Deed refinance at 3% interest for 2 years, but it goes up to 5 % fixed for the remaining life of the loan
. The 100k that the borrower still owes is recorded as a no interest second trust Deed for 5 years,but it has a 30 year term. If you sell, the 100k second is due and payable as the first would be .
At the end of 5 years the government will decide if they will extend the 100k o interest thirty year second or not or begin to charge 5 % for the remaining life of the loan .
If the intent of the government is to keep people in homes ,than they must come up with a plan that rewards people that in fact stay in the home . Bail -outs should not be designed for people who only had short term interest in ownership anyway . You can not say that a person who only planned on staying in the house for 1 or two years was a serious homeowner,but rather they were a speculator .
Also, this plan would work better because it would not reward a person who would take a equity cram down and just sell the house and run . Banks would have the option on their own to give short sales to hardship cases that qualify or people that have to move because of job loss or a job transfer .
You have to think in terms of incentives for borrowers to maintain longer term ownership .
If the government could pull it off I think they should get a split on costs for the price of the bailout refinance from the banks that they help .
You could even add that the homeowner that takes advantage of the bail out loan is not entitled to a mortgage tax right off as long as they are a receiver of the bail out loan until they start paying the full 5% interest payment on both the first and the second TD.
What the government in this instance is trying to supply is affordability until the market improves or the borrowers life improves . If the market is in the shithole 5 years from now ,the Government could just extend the 0 interest on the 100k second trust deed .
So,what this would do is encourage people staying in homes because their payments would be affordable . They would be paying some principal down for 5 years on their fixed rate first trust deed (giving the feeling of building equity ) and their only penalty is that they don't get the mortgage right off until they are paying the full interest rate of 5% on both loans .
The loan would just make it possible for the hype of the market (the 100k second ) to be frozen in time by the 0 interest ) until things improve ,but it would not take away the obligation .
The 3% for 2 years is designed to give the borrower time to pay off credit card debt ,get their house in order ,and have a chance to chance their habits .The additional money that will be freed up from their budget to spend on the economy would be a good thing also .
People that took out a primary residence purchase money loan from 2004 -2007 would be the eligible parties, including good paying borrowers . You give the deal to good paying borrowers also if they want it . A lot of good paying borrowers might not even want the deal because they would have to forgo their mortgage tax right off in order to get it .
People that have more than one home have to go through more qualifying to get this loan on their primary residence .
Also ,the borrower would be allowed to rent out the property
once they are paying the full interest rate after five years on both notes if they wish . They would be entitled to a hardship short sale in the future if they qualify .
They would need a trained staff of appraisers to confirm the values as of the time of the new loan .
If the market went down in value more ,it would not matter as much to the new bailed out borrower because at least they have affordability during the correction .
Also you would need to offer some incentives to new buyers to buy foreclosures . First, you give no incentive to anyone who has purchase a house in the last 7 years . Any incentives must only be for people who are not current homeowners,or anyone who might want to dump their current home to get in on the deal .
You might give a tax write off ,or you might give a outright money credit to anyone who buys a foreclosure ,who has not been a homeowner in the last 7 years .
But any new buyer must qualify for the payment . The reason you can't give just a broad brush incentive is because you don't want to encourage a current homeowner to dump their current property to get the foreclosure buyer incentive .
I'm just saying that any bail-outs have to be designed in such a manner that they do not create more foreclosures or a moral hazard .In theory if you are trying to help true homeowners ,verses speculators ,you have to
design a program like I suggested above .
I don't know if my suggestions would work ,but relief for a while on a payment obligation is a lot different than relief on a equity obligation forever . I just think that good pay borrowers would just walk in droves if struggling borrowers got
equity cram downs verses payment relief .Good pay borrowers would at least know they get the penalty of not getting a mortgage tax write off . You have to come up with something that won't pissed off people who don't get the relief loan .
Keith --
I think you are right on with that call. I think it is disgusting (having lived within my means), but what you described or something close is the only way the government can end the carnage.
In the near term, I'm short gold. In the longer term (6 mos-1 year), that could change. What happened in Iceland scares the crap out of me.
Oh, that's easy. Just like Government Student Loans, you will not be able to declare bankruptcy to discharge the government debt on your home. How's that for the new slavery.
What you are suggesting is equivalent to those 72 month car loans at a low interest rate. A question that needs addressing. Can average Mortgagee stay in a house for 30 years to enjoy the benefit of the low interest rate and house appreciation? Unless Mr Mortgagee is bound to his immediate area, this does not trade. And the last I read 25% of American households move every 7 years? Will average Mortgagee sacrifice his/her aspirations, career, family obligations to remain steadfast in a house that does not appreciate, at least at the rate of inflation?
What about the load terms on new home purchases?
Still going to require 20% down? Why should first time home buyers have huge downpayments and stiff terms? The government will have to offer THEM something too.
More importantly, what you are suggesting (and what is quitely likely i agree) is more massive increase in the money supply.
Obama hasn't even been the President elect for one week and he's already asked for an "economic stimulus" package. Here comes inflation people. Count on it. In fact, the faster it comes the less they will have to do to cover the mortgages, because the amount of those mortgages will shrink over time.
But the crash isn't over. We've got two more years at least. And nationwide refinancing plan will extend it even further.
"""
The payment on a $200,000 house at 4%/40 is $836 FYI. Which after expenses makes it close to what the home could be rented for in most markets. And government bond rates on 30 year T-bills are at 4% today anyway, so might as well take it from US citizens instead of just China.
"""
Those are opposites, are they not?
A T-bill is someone loaning to the government money at 4%. That home loan is the government loaning to someone else at 4%.
Most people won't go for it. Indymac found out that over half they people they tried contacting about a loan modification didn't want to go for it. No one is going to want to give a cut to the government because that's "their" hard earned money. Most would rather just give the homes back. Doctor housing bubble commonly writes about this topic and why it won't work. Nothing the government does is going to stop the value of home coming down to what they should be unless they pass a law making it illegal to sell homes below a certain value.
40 year mortgage? WTF?
true/false...bamas first appointment...a fanie/freddy looter?????????????????
In addition , in order to prevent
foreclosures in the future , any
person who took out a toxic adjustable loan between the years of
say 2003 to 2008 will have the option of applying for a better loan at the same loan amount of the current loan they hold .
Say we accept the fact that the general public was promised by the industry that they could refinance
out of the toxic adjustable loan ,than the government should give them the opportunity to get a little bit better loan . So lets say we give them a 5 or 6% fixed note ,with a fee charge ,and pretend that they get what they were promised by the lying scum loan and real estate industry . The loan refinance is simply based on the current loan amount with no allowance for cash out . Only parties that actually qualify for the payment can get the loan .
The only reason you would offer this to buyers is that as a government you are trying to
compensate for the lying no good scum industry that lied to the people and the government failed to regulate .
Loan would only be allowed on primary residences and loan would
not be a cram down on any loan amount owing ,but it would just be a more manageable loan for the borrower verses a adjusted up adjustable loan .
Keep in mind however that with the Libor rate going down ,many of these people will have a lower rate anyway than they might of expected . At least if you offered them a loan in which they could build equity ,and its fixed ,it would reduce fears and make it less likely that they will walk .
Also ,borrower that do not come even close to qualifying for the
new note will be denied because
it does not make sense to re-write a loan when the person couldn't even pay for it ever .Never write a new loan that the borrower can't pay for or qualify for the payment on because you are wasting time .
It cannot be the objective of a bail out plan to keep a person who qualified for a 100 k house in a 400k house . That person was just to far off from qualifying and no doubt they were a speculator or a party that lied to obtain the original loan . If a party comes close to qualifying than they can work with deals like that .
I like the idea, just a side note nice job on the new blog.
Keith, your plan and similar plans have too many details, and will require too many new rules and too much new federal bureaucracy. And too much money from the American taxpayer.
There is a much simpler approach: remove about twenty words in the bankruptcy code that forbid bankruptcy courts from splitting home loans into two parts: a secured part, based on current FMV, and an usecured part (the balance of the loan). Bankruptcy courts already have the power to do this on other secued loans, they just can't do it for a debtor's principal residence.
All these proposals focused on keeping the debtor in the house, ignore another part of the problem: for most of these people, the mortgage is not the only debt problem. There is credit card debt, car loans, student loans, medical bills, payday loans, tax debt, and more. The bankruptcy code is designed to provide one stop debt rehab. We don't need another federal program.
I have never been in favor of bail-outs of any kind ,but this situation is in part due to mass fraud ,mistake ,breach of lenders and Wall Streets duty to underwrite loans and over-see appraisals .Its a byproduct of defective loan products and Business misrepresentation ,etc etc etc. Oh ,lets not forget failure of Government to
regulate .
You could say that the Government is picking up the liability of Banks because they would not be able to pay because of insolvency
So, you would just offer borrowers a opportunity to get out of a toxic adjustable loan ,and get a fixed rate loan . One reason to do this is so the borrower will start paying equity toward the property .
I really don't think the current value of the property should be a consideration in the re-write of the loan . You just re-write loans at what the borrowers current loan balance is .
The biggest complaint of the borrowers is that they got hoodwinked into a adjustable ,
that they would not of taken had they knew what they were really getting . The borrowers are complaining that the industry promised them that they could refinance out of the toxic adjustable a couple of years down the road .
So, give the borrowers the fixed rate note that they were falsely promised by the industry at close to market rates at the current loan amount . The borrower should be able to qualify for the note .
The only bail out part of the deal is that you are giving a person a re-write on a loan ,when the current value of the property would usually prevent a refinance
given normal circumstances .
That is the other complaint by borrowers , had they known that they would be stuck with the adjustable loan because of the market falling they would never of gone on the loan . So give them the fixed refinance at present value of their loan balance with no cash out allowed .
You offer the loan to anyone that can qualify ,and a good pay borrower can get the loan also .
A fee will be charged because the
borrower would of had to pay a fee if they had refinanced ,but the fee should be on the lower side
like 1 point . Loan costs can be added to the loan amount ,but no other cash outs .
The current lender is the one that re-writes the loan and the government backs the loan for 5 years in the event of default to
encourage the lender to do it .
The loan would only be offered on a primary residence and strong proof would need to be made that it is a owner occupied residence .
This loan program would be easy to do and would save a certain percentage of foreclosures .
I guess I'm saying that we need more than one program to deal with the prevention of foreclosures and
remedy on defective loan products .
What is happening now is that borrowers who have lost their job are asking for relief ,borrowers who lied to a extreme degree on their loan applications are asking for relief ,speculators are asking for relief and people want cram downs of equity that reflect a
extremely discounted damaged foreclosure property value .
We can't all of a sudden bring borrowers loans down to the value of a foreclosure market . This is a extreme situation of over-correction . Better to give relief in the form of affordable
payments ,for a time period, rather than forgiving a loan balance .
It would be to much of a windfall for people who took out equity loans if you forgave the money they benefited from because of the equity loan .
If you cram down all the loan balances to the foreclosure value of the current market ,you are being just as false in the value as the Bubble market peak . I have seen some foreclosures going for 30 thousand that were originally priced at boom peak value for 200 thousand . So,you can' really get accurate appraisals right now ,so
you just re-write the current loan amount .
It sounds exactly like the type of deal that a car dealer would offer. To heck with the price, as long as the payments are okay. Are houses now depreciating assets? Never mind. Low interest loans did not help the auto industry. The commission is based on the price.
A long time ago I proposed the loan you are suggesting Keith ,but I quoted 3.75 % as the magic number of the loan interest rate .
The one advantage of offering 30 year notes rather than 40 year notes is that at least in the case of the
30 year note some principal is being paid down . In a market were homes are not appreciating ,paying down principal is the only form of gain in equity that is possible .
As time would go on the loan risk would become better because the borrowers would have more equity by paying principal on a fixed rate loan .
One of the problems with the creative loans was that often times the principal balance of the loan would increase, which made it a more risky loan with time .
i know it isn't popular today to think in terms of paying down equity and not using a house like a ATM card ,but in the past this was a objective of borrowers .
As time goes on ,the borrower start paying down more and more principal . If the market recovers in 10 years ,at least the borrower had that forced savings plan of equity building .I'm not saying that there isn't better investment plans ,but this is one that the public likes ,along with the real estate tax write off .There is still incentive in that the government offers a tax free exclusion on capital gains ,(in case people do gain appreciation over the long haul ).
Real Estate is just not a good short term investment normally ,especially if you consider the costs to sell or buy . Only because of this fake bubble was real estate turned into a short term investment by the market makers .
Keith, I posted a message on your old HP blog about how the government was going to bail out people like me who are in financial trouble. You and your minions mocked me and made a lot of fun of me.
My thesis was that sooner or later, the government will bailout people who bought expensive homes. You folks made fun of me, ridiculed me, etc... Guess who is laughing now?
I just saw a post on the Great Depression . Apparently a lot of
people lived on farms . So, to
foreclose on a farm owner would also be taking his job away from him .No wonder the Banks and Government were willing to offer relief during the Great Depression by allowing a farm owner to rent
or putting a freeze or deferment on paying the note . Apparently during the Great Depression ,the Banks and the Government did not bother with bailing out people who had no chance of making the loan good .
The difference with the modern day borrowers wanting relief is that they were often times fraudulent
loan borrowers or speculators who will just go back to renting .
The reason for the struggle on paying a loan during the Great Depression was the Stock Market crash that caused bank failures and than unemployment and than a drop in the price on what farmers could charge for food . Wages in fact deflated during the Great Depression and money was not in circulation because of the circumstances .
During the Great Depression the banks didn't reduce principal . They would rent-back ,or freeze foreclosures ,or re-write loans ,or give a new loan .
Apparently the Banks raised the cost of new loans to compensate
for the cost of the interference with being able to foreclose .So
during the 30's the borrowers were very different than the ones crying for relief today . Also, if a borrower didn't have a chance to make a loan good ,they would just foreclose in those days and not bother with relief . Interesting isn't it .
What about people who don't own houses, do we get these preferential deals aswell?
Any way you look at it ,you can't save a fraudulent loan market .
In truth the real estate market became a Ponzi-scheme in which creative loan products were designed to keep the party going without any regard to underwriting those loans .
People were allowed to get in the game without any down payment or skin in the game ,or proof of ability to make the loan payments .
The market crash ,the borrower couldn't refinance out of a toxic adjustable or sell to get out of
the gamble .
Unlike any other time in History a
mass crime wave took place ,along with a total breach of duty on the part of lenders to underwrite loan risk ,or prevent fraud .
Not only would it be a Obstruction of Justice to bail out these fraudulent loans or faulty loans , you can't save them anyway because of the reason
why the person went on the loan to begin with .
Offer a bail out loan for people who want to save their property at the current loan amount (if they qualify ) ,without the requirement that it can only be a defaulting borrower that gets relief from a toxic adjustable loan . Than let the chips fall as they may .
Or, offer a incentive for good pay borrowers to stay in their homes .For instance ,offer a 5 thousand dollar tax credit to any party that obtained a loan between 2004 and 2008 who does not default or walk from their property for 5 years . Or give a borrower a two thousand a year tax credit for not walking for 5 years .
With the combination of re-writing a toxic adjustable loan into a fixed ,along with a yearly tax credit during the emergency to reward a borrower for not walking ,at least you could cut down the amount of foreclosures from borrowers who would walk in spite of being able to afford their obligation .
So, some part of me thinks that the powers have to give incentive for good borrowers not to walk ,rather than give bailouts to bad borrowers who will walk any way you look at it .
You could also control by a penalty by enacting a law . For instance ,any one who defaults who is found out to be fraudulent on their loan application does not qualify for loan recourse .One of biggest mistakes Congress has made recently was to do any with the tax penalty on forgiven debt .
Currently the powers are rewarding people for bad behavior ,(not that I blame people for their bad behavior under these circumstances ,but I hate the fraudulent gamblers ).
The mania defense is no doubt what people are relying on to excuse their fraudulent behavior on obtaining a property by loan application fraud . "The realtor and loan agent said I could do it",
is already the stance that the fraudulent gambler borrowers is giving ." I didn't know what kind of loan I was getting ",is often heard .It's all BS .
Maybe the government should propose rent-backs on foreclosures just to keep the house from being vacant.
$836 a month for 200k?
That would mean that $1600 wouldn't even cover a 400k loan.
People were financing $600k at less than $1600 a month. Now their loan balance is closer to $700k.
Do the math. The neg-AM people are f*cked. No way around it.
Just send them to labor camps.
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