The terms of your loan are written out in bold letters within the first handful of pages in the loan document. It's almost impossible that people don't know what they are signing and what they are getting into. A lot of them are now playing stupid because things didn't go the way they planned. I feel sorry and I hope we can help someone who lost their job because of this mess and it's effect on the economy. I don't feel sorry for those that still have their job but can't make their payments because they signed for a loan they took a chance on. They knew they might not be able to afford it but they signed anyway. Now they are playing stupid and being phony. Maxine Waters represents might district and she's being phony too. I feel sorry for seniors that were duped by the mortgage agents that were knocking on doors, and I think door to door solicitations of any type of debt should be illegal. But other than that people knew what they were getting into, but there was a housing frenzy and they wanted to get into it too. The politicians are as guilty of this as anyone. They should not have allowed limitless tax breaks on mortgage profits if you bought a new property within a few years because that helped fuel the "flipping" craze. One tax break every 8 or 10 years would be enough. They should go back to the old way of measuring inflation because the inflation numbers would have been much higher and interest rates would have needed to be higher. Low interest rates were part of the problem because it drove up housing prices along with the "flippers" and the overall "cult of housing" that was going on. The real victim are the people that have lost their jobs because of the pathological conditions that led to the housing bubble, and our children because they will suffer for decades because of this. I never understood why people were so happy to watch and 200k house in L.A. go to 750k. Sure they were happy if they sold and made a big profit, but they also had to know their children would never be able to afford a house in their area, and that someone eventually would get stuck with a severely overpriced house. The people that bought at inflated prices are the ones that are hurting, but all they talk about is getting housing prices to go back up and that will solve everything. True affordable housing that people can buy using no more than 30% of their monthly income for their mortgage payments are what we need. What we don't need is a housing market where housing is a commodity with wildly fluctuating prices, and people are either big losers or big winners. Slow and steady is the way to go instead of "casino capitalism" as someone in Europe reffered to it.
In Debt and Confused
Rep. Maxine Waters on why some of her fellow legislators don't get just how bad it is.
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When President Obama signed his economic recovery bill in Colorado on Tuesday, it brought the amount of government spending and bailout-loan packages to nearly $2 trillion since last summer, roughly two thirds of the annual federal budget. Obama's focus, of course, has been to stimulate the economy by funding broad expansion and job creation. And the Troubled Assets Relief Program (TARP)—two installments of $350 billion—was designed by the Bush administration and Congress to juice the credit markets and prevent even more foreclosures.
So where is all that money going? That's a little tough to comprehend let alone answer. At the micro level, homeowners are the ones being foreclosed on or, at best, seeing their house values drop. They're watching credit dry up for big purchases like cars, the price of education climb and their debt grow even as they lose their jobs. All of which makes the dollar signs coming out of Washington nice to look at, but it will be a while before that money materializes into actual relief.
Hoping to speed up that process is the outspoken Rep. Maxine Waters. "The taxpayers of America are very, very upset about the fact that they allowed the banks to borrow their money, the taxpayers' money, in unprecedented amounts, billions of dollars," she told the CEOs of the eight Wall Street banks as they testified before Congress last week. She, along with several other members of the financial services committee, accused the executives of having little to show after all the TARP funding. Waters spoke with NEWSWEEK's Daniel Stone about what else the government might do to help average Americans. Excerpts:
NEWSWEEK: Will the wads of government spending, including the latest round of TARP loans, be able to provide tangible relief to consumers?
Maxine Waters: Yes, it will. But I'm worried that it won't be enough. I'm worried that whatever is done with the TARP, there won't be enough done to reduce interest rates and loan principals. And I think the TARP should come with protection against rates and fees. Consumers need more protection.
What else can you do?
We'll need to have additional legislation that gets back to all that predatory-lending legislation that was never successful in Congress.
What will that legislation look like?
Well, now that the stimulus package has been signed and attention is being returned to the TARP, what we're doing is trying to convey our concerns to institute [more] protection. One member has a credit-card bill of rights and there are several predatory-lending bills that haven't been quite good enough. Also, following the TARP allocation, banks sent out notices limiting credit-card amounts. That's something we're talking about now, too, as we discuss how effective the full TARP allocation will be.
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