While I would like to keep as many homeowners in their homes as possible, this strategy is more likely to result in a large bailout for lenders, while protecting a very limited number of borrowers.Oh, by the way, Chris Dodd -- former Democrat presidential candidate, and THE Dodd of the Dodd-Shelby bill -- has been publicly busted for accepting favors from the head of Countrywide. He's playing dumb, but he's known about his sweetheart deal for years - that's why it's called a 'VIP' loan, stupid! It's also no small coincidence that Dodd is the Chairman of the Senate Banking, Housing and Urban Affairs committee, which controls the mortgage industry. Oh, and he called the head of Countrywide to ask for the loan himself, too. It doesn't smell any more rotten than that, people!In particular, [the Congressional Budget Office] estimates that under this program, quote, "Mortgage holders would have an incentive to direct their highest-risk loans to the program," close quotes. For a modest write-off, lenders who were in a number of cases either fraudulent or negligent in their treatment of borrowers will be able to clear out many of their problem loans.
At the same time, CBO estimates that the cumulative default of the home program would be about 35 percent, meaning that one out of every three loans refinanced would fail. Creating a new federal program that takes on the worst of the worst subprime loans, which will hurt [the Federal Housing Administration] and ultimately the taxpayers, is extremely troubling.
Call your Senators today, and demand that they put a stop to this bill. While you're at it, how about suggesting an investigation, too?
There's my two cents.
No comments:
Post a Comment