1. Suspend the payroll tax for any small business that expands its workforce by 10%. A small business is defined as having 250 or fewer employees.
2. Have a moratorium on foreclosure action so long as borrowers, who may have lost their jobs or taken pay cuts, make minimum monthly mortgage payments. Banks should be forced to accept what the borrowers can actually afford. Fannie Mae and Freddie Mac have lowered the ratios to qualify for loans to 45% DTI (debt to income). This means if a borrower adds up all his monthly debt payments, they can't exceed 45% of his gross income. Banks should accept mortgage payments from borrowers in an amount such that the borrower’s debts don’t exceed 45% of his income. Lenders can add shortfalls to the loans and collect them when the homes are sold or refinanced.
3. Require TARP-funded banks to lend a dollar to small businesses for every TARP dollar spent on Treasury bills, bonds or notes. If necessary, the banks need to sell their Treasuries and make loans.
What we don't need:
1. A jobs summit that includes the labor department but not the U.S. Chamber of Commerce, or one that seeks input from leaders of major corporations but ignores small business owners.
2. A bigger deficit. Every project on the drawing board that won’t significantly reduce the deficit should be put on hold indefinitely.
3. More politicians who haven't a clue about the mortgage industry writing legislation to fix the industry’s problems. This behavior has set the industry back years, if not decades.
4. Overreaching healthcare reform written by disinterested politicians who get to keep their own "gold plated" policies for which we, the citizens, pay.
Finally, some questions for you to consider:
Do you think we are out of the recession or even close to being out?
Do you think our elected officials are sincerely concerned about the financial problems of ordinary Americans, or are they more focused on getting reelected?
These are serious times and I am not sure there are enough serious people in positions of influence to move this economy in the right direction. I pray that I am mistaken!
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.