The President has divided the country into two camps not by political parties or ideology but by those who could need help and those who should be helping. It sounds biblical on the surface but doesn't exactly flow in that manner. It is actually a road map to “placate” (my thought not the President's) those who need help and punish those who have achieved and are the would-be helpers. It seems to cover all facets of the plethora of programs being proposed by the current administration to completely change our country. We are continually learning of plans and programs in all areas of government that are being examined and changed in ways that could help without hurting, but seem to miss the mark. Let me begin with mortgage financing and then move into other financial matters to make my case.
We are in a real estate crisis of epic proportions that could be alleviated quickly, but instead is being dragged on in many frustrating ways. A plan has been laid out in two parts to help stop the foreclosures. The plan has great details for both those in trouble and those who are failing and minuscule details for those who are in trouble but have made the determination to fight to the end. The plan also only helps those who have conforming loans (maximum $417,000). If you have missed your payments, are heading for foreclosure or are almost through the process, you can have your loan modified in size, interest rate and payment. The banks have been empowered to stop the problem in its tracks, being given financial help in this endeavor by the government. If you are failing (meaning paying more than the ratios say you should) or have a house that is considerably less in value than your loan and have interest rates well beyond today's average rates, but are now and have always made your payments, you need to have the luck of the Irish to get any relief at all. The question I get asked the most: "I have made my payments, I am underwater (house is worth less than the loan) and can't get help, yet those who haven't made their payments can get the help. Why should I keep making my payments?" What's your answer?
Roger Schlesinger
Roger Schlesinger's Mortgage Minute is heard on hundreds of radio stations and daily on the Hugh Hewitt radio show and Michael Medved shows. Roger interacts with his hosts and explores the complicated financial markets in order to enlighten his listeners and direct them along their own unique road to financial freedom.
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