Democrats are hoping that todays vote will lead to a bi-partisan agreement by the republicans, so this plan can be implemented right away. Many people are concerned about the tax payers funding of this plan, and how it is unfair for honest taxpayers to pay for speculators of loans, and people who made bad decisions with buying their homes. It is estimated now, that this plan will cost about $1 billion dollars.
Conversely, the federal government paid $29 Billion Dollars last month to bailout Bear Stearns, for an arrangement of a merger between them and JP Morgan; two investment banks. How president Bush can take a position on this FHA bailout of vetoing it, before he read it, makes many people wonder. According to Realty Trac, there was a 65% jump in foreclosures in April from one year ago, so this problem is getting worse. There needs to be a solution to this mess. And this needs to be handled very carefully.
A year and a half ago, when Fannie Mae and Freddie Mac were busted because of an accounting scandal, many regulators wanted to do away with Fannie Mae and Freddie Mac altogether. In todays market, post sub-prime meltdown, Fannie and Freddie account for over 80% of the mortgage market right now. If we ousted them 1 1/2 ago, this mortgage problem, would be 1000 times worse.
The White House needs to look at this reform bill as only costing a little over $1 billion dollars, and having the ability to correct a market that is in need of a serious boost of confidence.
In closing, as a mortgage broker I am in this for the long haul. Markets are cyclical, and we are in a down turn. However, how are we going to be able to define a bottom on this market, if we aren’t given the ability to weed through the mess, and correct this market with a bail out program? Money is very tight right now, and if $29 billion can be given to Bear Stearns, why cant we get $1 Billion to contain the mortgage meltdown?
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on Saturday, May 8th, 2010 at 3:52 am and is filed under $1 Billion Dollars Articles.
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