Mortgage bailout plan sparks anger
President Obama's housing plan will help nearly 9 million homeowners avoid foreclosure or refinance. But the plan is drawing ire from homeowners who won't be receiving any help. Nancy Marshall Genzer reports.
Mortgage troubles (iStockPhoto)
More on Housing - Real Estate, America's Financial Crisis
TEXT OF STORY
Tess Vigeland: Banks, of course, are but one facet of this crisis and recovery attempt. Earlier this week President Barack Obama unveiled a new foreclosure prevention plan to generally positive reviews from economists. But never mind them. Even though the plan could help as many as nine million homeowners, some of the other millions have a little something to say about that. Marketplace's Nancy Marshall Genzer has that story.
Nancy Marshall Genzer: Yesterday CNBC's Rick Santelli was at the Chicago Board of Trade. He started complaining that Obama's plan rewards people who took out mortgages they knew they couldn't afford. Then he turned to the traders.
Rick Santelli: How many of you people want to pay for your neighbor's mortgage that has an extra bathroom and can't pay their bills? Raise their hand!
Santelli seems to have touched a populist nerve.
Mare Runge: Those of us who did buy within our budget and bought something we could afford, we're the ones who are getting screwed now.
Mare Runge is upset that she can't sell or refinance her Chicago home. She doesn't qualify for government help. Neither does Margo Miller of suburban Detroit. She wants her loan downsized.
Margo Miller: Lower the principal for everybody and make everybody even.
There are no polls yet on Obama's plan. But in December, the Pew Research Center asked if the government should help homeowners facing foreclosure. Pew pollster Michael Dimock says 49 percent of the respondents said yes -- 43 percent, no.
Michael Dimock: They don't like bailing people out of problems they dug for themselves and I think that's where you're finding the mixed reaction to this.
Dimock says there's no shortage of opinions because this issue hits very close to home.
In Washington, I'm Nancy Marshall Genzer for Marketplace.
Comments
Comment | Refresh
From KY, 09/24/2009
I bought within my budget and now I'm being punished for it but the ones that went out and bought over there heads are being helped out to where when it's all said and done they will get their house paid off buy the goverment and I will still be paying on mine . I guess I should have bought something I knew I couldn't afford also . I think if they get the help it should go against their credit scores big time and the ones that do not get help should be awarded points on theirs .
From tampa, FL, 03/09/2009
What a bunch of selfish people we have here, i too bought a house that back then i could afford, it was one of the cheapest properties i could find, under 200k, 180k to be exact, its not like in this country affordable housing is a priority for anyone.However i no longer have the job i had making 70k a year, i got laid off, i've been applying for jobs for months and received not a single response. i have paid my taxes and contributed to society in a positive way, why is it so bad for the government to help me now? It is obvious to me that all the ones not in favor are well off and haven't lost their jobs. I hope that none of their family members find themselves in this position ever.
God Bless you anyways.
From Brooklyn Center, MN, 03/05/2009
I agree with many of you I bought my home in the boom as well I have never missed a payment and I have been financially responsible, but I think we need to blame the banks who told thousands of people that they could afford these houses. When I applied for my home loan I was told I could afford much more then I took, the bank said I could afford the higher amount yet I didn't use it. Please do not be so quick to attack the individuals please consider the financial industry incorrect lending patterns.
From Castaic, CA, 03/04/2009
I am wondering if this "bailout" loan modification will help people like me? Here is my situation: My wife and I bought our home in Nov 2007. Since then just like everyone else the value of our home has declined significantly (100K). We are still making the payments because those have stayed the same (fixed rates) on both the second and first mortgage. I want to renegotiate my rates so that they are lower. I have been making my payments on time and are just making it. Is this new policy just for those who are in foreclosure or about to go into foreclosure? Is it rewarding those who have become deliquent and punishing those who are current? I feel that in order to get any help in reducing my payments I need to stop making them! That just doesnt make any sense.
From El Monte, CA, 03/04/2009
I am also upset with the plan to help the irresponsible owner.
I bought a house at the same time the housing market is booming. I choose to buy something I can afford.
Why do I have to bail them out?
The best way to bail them out, is by making the bank lower the principal for now, and put the difference at the end of the loan-so when market going up again, I am sure they try to cash in by selling the property then the Bank will get their different of the principal plus the interest. Nobody loose excep the BAnk has to postponed their revenue from the interest.
This way, prevent them form losing their homes and yet does not cost as much as what has been put out now.
Everybody have to live with the decision they make whether it is a right one or wrong.
To make the responsible buyer be responsible for the "Fault" decision they make is NOT RIGHT.
From Seattle, WA, 02/23/2009
Why is the media not explaining this more fairly? Banks have the ultimate say to the homeowner if they are going to approve an agreement. President Obama cannot force the banks to do this. Its the banks fault!
From Chenango Forks, NY, 02/23/2009
If we are going to bail out those who have over bought, should we not give something to those who have paid on time? Or paid off their mortgage? The bigger question is what is the percentage of bad montages to good ones. the news would like us to believe it is much higher than it is. Bottom line is you have made a commitment to your lender keep it. This small act will go alone way in fixing the housing problems.
From St. Augustine, FL, 02/23/2009
I was energized and ready to comment on the idiot telling us that it is our "duty" to support the mortgage bailout plan and then when I found the page and saw that there were only a few comments (3 days after the broadcast) I realized that no one is even listening to this dribble. Why even waste the time to comment. And by the way, the greed on behalf of the bankers was enabled by reducing banking and mortgage lending oversight and embracing the community redevelopment act which essentially promoted the whole practice of putting people in homes even though they would never qualify under the "prudent lending practices" the gentleman on the show accused bankers of failing to follow. Sir, you cannot have it both ways, even with the Messiah as "your" president.
02/23/2009
So, when these people who can't afford the houses, first moved in to these empty houses, paid town taxes, mowed the lawn--where were these neighbors who could afford the house next door? Where were the complaints then, that the new house next door was no longer empty?
From Manning, SC, 02/21/2009
It seems to me that the homeowners, the backs, and the loan gaurantee companies took unecssary risks in searh for either a house they had no business owning, loans they had no business giving or insuring loans that did not pass the smell test. If we want to bail homeowners out I would recomend the banks forclose on the homes, the motgage insurance companies paying what they promised to the banks and the credit agancies placing a moritorium on forlosure affects on credit ratings. The homebuyer will lose all the money they put into the home. The mortgage and insurance companies will make back some of their losses on the resale of the property, and they will write off the loss on their taxes. Atleast this will lessen the burden on the taxpayer. Botttom line you make a bad investment and assume the risk when you make a loan and for that you choose your own fait. The government required industry to make loans to less qualified people but they never required industry to make loans that people could not afford and it is your responsibility to ensure they can pay it back.
From COCOA, FL, 02/20/2009
A mortgage bailout is the first 'spending plan' of the current administration that has made any sense. While I am not in favor of ANY entitlement or 'bailout' plans, at least this one is a real attempt to fix the housing crisis. I would be a lot less opposed to this one if we (by 'we' I mean 'taxpayers') hadn't already been saddles with a $800,000,000,000 bill that didn't fix anything (plus interest and inflation) While I feel that a lot of people made mistakes and got into houses they couldn't afford, I also feel they were influenced and led into those bad judgement calls by the banks, the media, the dozens of "flip this house" TV shows and greedy real estate agents that were hapy to collect all the commisions on these overpriced houses.
02/20/2009
If i buy a house i can afford and make my payments, and you buy a house you can't afford & go under bc of the balloon mortgage payments. . . so far so good.
But then, if you want the government to take my money (or my grandchildren's money) to bail you out. . . that's unethical & immoral.
From manhattan, NY, 02/20/2009
I am a renter in Manhattan and my rent just went up to truly astronomical levels. All of my savings went into the stock market, not a house, and my net worth is a third of what it was this time last year. I see nothing on the horizon to help renters. No one is even discussing it. My opinion is that homeowners facing foreclosure because of job losses should be helped because it is just the humane thing to do and everyone else should just stop whining.
From Las Vegas, NV, 02/20/2009
I my community about 10 foreclosure: I did have any equity in my house: I owed 186,000. I my community for low as 158,000, same house as mine. But I do think wells fargo will lower my principal, I do pay on time, never late, good credit, but no equity, even the down payment 12k is gone.
Post a Comment: Please be civil, brief and relevant.
Email addresses are never displayed, but they are required to confirm your comments. All comments are moderated. Marketplace reserves the right to edit any comments on this site and to read them on the air if they are extra-interesting. Please read the Comment Guidelines before posting.
You must be 13 or over to submit information to American Public Media. The information entered into this form will not be used to send unsolicited email and will not be sold to a third party. For more information see Terms and Conditions and Privacy Policy.