1. Why are so many people going into foreclosure? 2. Why does the government need to help them?
Question:
Answer:
Because it's expensive for ignorant people to be greedy. The government doesn't need to help them.
Because they signed up for adjustable mortgage rates and the government does not need to help them. Hillary is pushing for a 2 billion dollar fund to protect those homeowners who extended their finances! Tsk tsk.
They took out ridiculous mortgages with bad terms, assuming that real estate values would continue to increase indefinitely.
I'm not sure if they should be helped by the govt. but I think if that's the case we shouldn't help the investors (hedge funds, etc.) who invested in financial instruments backed by these loans.
In other words, the Wall Street types ALSO went into these deals (on the lender side) with their eyes open, and they should also be hung out to dry, Jim Cramer's whining notwithstanding.
This was not the case during the last big banking/mortgage crisis (80's) the S&L thing, when supposed "laissez faire" capitalists who speculated wildly in high risk investments came crying to the government to rescue them and were bailed out.
Aside from being Broke? Stupid mortgages conditions, terms and rates. It's harder for the average Americans to file Bankruptcy or find forgiveness for debt relief. Now, who did that?
Because they shouldn't have qualified for a mortgage in the first place, since they couldn't pay their bills, but this has happened because President Bush - along with most liberals and conservatives - is pushing the globalist agenda promoted by the owners of the Federal Reserve.
Most people that comment on this question probably dont even own a home. The reason why there are so many foreclosures is because 1. Adjustable rate mortgages are coming up and their payments are going up min. 300 dollars 2. They were forced into the loan by a predatory loan officer that promised they could refinance in a short amoount of time. 3. Now they can't refinance because their is zero equity in the home. The government should help since they let lenders get by with these predatory lending type services. It should have been illegal for loan officers to make revbate points on the back end for promoting an ajustable rate mortgage that in now way benefited the homeowner. That is why loan officers (at least here in nevada) make more than doctors and lawyers..
Well Im no economist, but I did stay at a holiday inn express. 2 words. Housing bubble. We're still suffering from the downturn of the earlier 2000's housing bubble. Whats a housing bubble? It was crazy, people were getting into bidding wars for real estate and the price was going sky high. Basically when too many people say OOOH I want land and a house and the market rapidly becomes a sellers market and prices get driven up like mad. (not to mention credit at an all time high per person, per nation) The only people the bubble benefited were those who sold during then at those fat prices.
Now it is simply going through a correction. Imagine what would happen if people paid 30% more for a car than retail and if something went wrong, you lost your job, and didnt have the income you thought youd have? Youd sell off that turkey for nothing around what you bought it and regret the day you ever stepped foot into the office to get financing.
Some people think govt needs to be the answer to everything. It shouldnt be, and isnt. Asking the govt to fix something is like having a pool thats too wavy and having someone jump in to fix the problem with the waves. If you give it time, itll settle on its own. Thats how markets are.
And cats rule.
The houses don't vanish. They are sold at a low cost to someone, who profits when housing values go up. Maybe the owner will live in an apartment for a while on the money they make when they sell the house. The Government does help homeless people. When times get poor enough interest rates drop and people can afford to buy houses again. The market runs in cycles. Maybe they will buy a lesser house and make a profit in a few years when they sell.
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