How bad will foreclosures and late mortgage payments...?
Question:
Is the FTC making arrangements to help people who are struggling or are they just going to let everyone hit credit rock bottom?
How will this affect the economy later when many will not be credit worthy?
And, what's the real reason that rates aren't being lowered? We see the mass devastation that is happening all over the country with late mortgages and loan defaults. At some point wouldn't the government NEED to step in?
Buyers feel like the market is a sinking ship and don't want to buy because they know that the values are still dropping. This is VERY smart thinking. How long will this be the reality?
Who is going to step in and make a change and when?
Answer:
Foreclosure looks quite bad on an individual's credit report, but creditors look at the entire picture. If the mortgage was the only negative mark, then the homeowners' score may not drop down so far. If they took out a lot of loans that they did not pay back, though, their credit will be far worse. And, if this is the case, should they be given credit again? Probably not.
The FTC is probably going to do nothing. As long as the economy looks like it is doing well, regardless of what the poor and middle classes are experiencing, the government will do little but pay lip service to the foreclosure problem.
It won't really affect the economy later, as credit has pretty much dried up for the lower classes, even as corporations are being given more and more credit to purchase other companies and consolidate their own power and position in the market. The housing credit bubble has been transferred to an equity credit bubble.
Rates aren't being lowered because, if they were lowered, the value of the dollar would fall even faster. If rates were dropped, fewer governments would hold dollars as their reserve currency, and would sell their dollars. With extra dollars being sold on the market, the value decreases, and homeowners already in financial distress would see prices increase even more than they currently are. So the Fed is in a bad situation and nothing they do would make it any better for homeowners.
Individuals and communities will have to step in and make their own changes to affect the situation. Communities and private investors and local banks can act to keep the wealth in their own neighborhoods, by helping homeowners in foreclosure. This is a much better solution than seeing large portions of the country being owned by multinational corporations.
The government, by lowering rates so far after 9/11 in an effort to stimulate the economy, dug a very deep hole for homeowners. Homeowners willingly jumped into that hole, though, and used their homes as ATM machines, taking out more equity to finance unsustainable consumption. So it would be absurd to trust the government to then step in and help. All they can do is shovel dirt onto all of the people in hardships now, burying them alive. Or they can dig an equally deep hole that everyone in the current hole can jump into. Either solution isn't desirable.
Hope that answers your questions.
ForeclosureFish
http://www.foreclosurefish.com/...
The only people responsible for the current housing mess are the ones that bought seasoned trade lines to raise their credit so they could qualify for loans that they really did not deserve and the appraisers who said that homes were worth more then they really were so people could get mortgages without making down payments.
Add to that the morons who signed adjustable rate loans thinking that the market would bail them out before the higher payments kicked in and there you have the result, foreclosures all over the Country.
This will change, but it will take a few years for the market and the lenders to recover from these losses.
As far as how bad it will look, there is nothing as bad as a foreclosure, bankruptcy or repossession for your credit.
As far as the FTC stepping in, they have to a certain point. Come September the way credit scores are calculated will change and people that are authorized users will no longer get additional points added to their scores. This is going to be retroactive so anyone that has gained points by this will lose them.
Other than that, it is not the FTC's job to step in and save anyone. Nor is it any branch of Governments job to save anyone from their own mistakes.
"At some point wouldn't the government NEED to step in?"
Believe it or not, not everyone is struggling. There are people who made the decision to live within their means and get a house they could actually afford. Then there are those who went with these fancy loans to get bigger and better and worry about that increased payment tomorrow. Well tomorrow is here.
Why should some idiot who made a dumb dumb mistake be bailed out?
Why aren't rates lowered? My God, they're at 40 year lows!
The government doesn't need to rescue people from loans they shouldn't have taken in the first place. No one held a gun to these peoples heads and made them sign an expensive mortgage.
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