TO FIX OUR ECONOMY

you do realize that 750,000,000 is between $2-3 per person, no? blast! foiled again!

and of course you realise that a 7% margin on a 2005 loan would put interest rates in the 12% range, yes?

and you do realize that forgiving ALL taxes in 2008 means operating the entire government for 12 full months on borrowed money and that in '07 we spent close to 3 trillion?

and all for what? 100k jobs is equal to .03% of the population.

how would this "stabliize" housing? PEOPLE CANNOT AFFORD HALF MILLION DOLLAR HOMES. THEY NEVER COULD.SHORT OF A 200K FIRST TIME HOME BUYER CREDIT, NOTHING WILL CHANGE THAT FOR A DECADE.

although i'm sure you put alot of time into this proposal, you get a "d" on your proposal

(or 3 decades)

and how exactly does number 2 work, anyway?

if an appraiser knocks on my door 3 years in a row and says "your house is worth what you paid in 05" that means its worth that? what possible correlation could raw data have with stablizing home prices?

"he Gov't uses local appraisers to appraise each and every home... the value obtain is the value for three years. (Stops declining value) housing stabilizes."

or is this a "wait for it to be over and then claim that YOU had something to do with it" thing?

and tell me this, why should a lender be forced to offer any kind of interest rates? the concept of interest is that i am risking my money and hoping that you'll pay me. price risk, that is a good thing! it means that banks have learned that some people dont deserve a 2% loan teaser.

and while your at it come back with an answer to this question:

why the hell should the govt take on the first 20% of every home out there? the banks SHOULD have losses, the lenders SHOULD have losses. they made the dumbass loans to begin with.

i changed my mind.

F - -

worst proposal yet

Remember 1 thing the people are the ones that are going to pay for this $750,000,000 for the next 7-10 years. So lets stop writing another check to that company that is closing and making people loose there jobs faster that anyone can count. GIVE IT TO THE PEOPLE! IN THE FORM OF DISCOUNTED TAXES / MORTGAGE RELIEF THAT WILL ACTUALLY HELP SOMEONE / AND COUPLE $$$ IN THE POCKET WOULDNT HURT.

If you read it the Gov't dosen't take on the debt it tells the lenders to forgive it.  the Gov't in this plan is rewarding the people. This morning why in the hell should Citi get this bailout, AIG, other Banks, and possibly Autos. The biggest issue is there ain't that much buying  going on what they are doing is crazy.

I think we should just go hunt down a leprichaun and get his gold.  Sounds just as logical and realistic, but without as much moral hazard.

Its 750,000,000,000. not 750,000,000.  Now, thats like a few hundred per person.  Houses need to fall in price to $120k in flyover country and $200k on the coasts or we all need big time pay increases!  Building 10mil excess homes is not a good way of spending borrowed money and for this; the map is surely f*cked!

Brian:

I cannot support any attempt at resolution that includes the government hiring anybody. Government has a history of incompetence. I can only imagine how efficient government appraisers will be.

We may be on the brink of witnessing another great government fiasco as oil prices decline and our government moves forward spending money it doesn't have on alterative energy that is much more expensive than oil.

Bloody hell!  Another world improver!!

Brian, please read this thread:

http://www.zillow.com/forum/site/ViewThread.htm?tid=47781

You are a poster child example.

and...

'...and remember we all had a hand in driving up prices and creating loan products to get borrowers...'

Who is 'we all' ??

Please don't lump me into that 'we all' group.  But of course, your solution requires me to be lumped in to help pay for it (whether you meant $750M or $750B, but, hey what's tens of thousands of dollars among total strangers).

And since I just can't let that statement die, please stop lumping the everyone in this country as having created this mess.

There are many innocent parties out there:

1) Renters

2) People who own their home completely

3) People who bought before the bubble, and didn't refinance, pull out equity, etc.

4) Banks who did NOT offer NINJA loans.

5) Hell even people who bought during the bubble but put down more than 20% and still paying...

The list goes on.

Frankly, there are very few guilty parties here.  And every solution being offered, yours included, is to take from the innocent and give to the guilty.

God I hate 'world improvers'.  Too busy trying to fix the wolrd, and never take the time and fix themselves so that the world wouldn't need improving...

My parents generation are IDIOTS.

These tools born between 1946 to 1964 have presided over the most peace and properity in US history and what did they do ?

For the last 30 years they have partied it up and soaked whatever the hell they could out of it . Now the parties over and what do they want to do ?

Spend their way out of it . In other words, have a FREE RIDE and dump the price tag on my generation and my future kids and grandkids.

They are BABY BOOMER RUN WILD.

They should make videos of it instead of girls gone wild.

.........BABY BOOMERS GONE WILD ............. show videos of wall st, big CEOs , private jets for bankrupt auto makers and of course congress.......

I know yer supposed to honor thy parents but my god I cant take it anymore.........

also doesn’t consider the investors that have been buying the foreclosures are now not in the houses as well as they were before your plan would go into affect. 

Unless they give foreclosed homeowners a free ride and chop off the excess principal, they will walk away and declare chapter 7. Banks and the gov know all this and have tried to avoid it at all cost.

They would rather try to sucker as many folks as possible into the 'debtors prison' of a lower rate but still 100 grand underneath a house they dont even really own. Once that doesnt play out, they will have to accept the fact that either we make the foreclosure / bankruptcy / inventory problem worse, or redo the mortgage to current value.

I believed everyone was covered.

1) Renters would benefit from the Tax Free year which may provide enough to buy a home, if they wanted to or they could invest it. Property will be available with no threat to any property devaluation.

2) People who own their home completely - also benefit from the Tax Free (Freezes the value for three years)

3) People who bought before the bubble, and didn't refinance, pull out equity, etc. benefit from the tax free also freezes the value for three years.

4) Banks who did NOT offer NINJA loans. Is not just the people that got NINJA loans its people who now have lost their jobs and can't pay on the 5% mortgage or their property value has declined and they can see their retirement really begin to slip away, most did view their real-estate as a real retirement asset (we must preserve this)

5) Hell even people who bought during the bubble but put down more than 20% and still paying... These people have seen that equity disappear in most cases this program stops the down fall.

6) Most retiree pays no tax so the stimulus will benefit this group

Tax refund and the stimulus will help all people it will allow them to move towards being debt free or invest. It would be enough to right this ship -

The loan forgiveness and values frozen for this time period should provide stability which will allow for current toxic assets to obtain a value and homeowners now have a future will but a All can agree this is better than the Gov't loaning these companies all this coin in exchange for ownership, if we the consumer don't buy how will these companies survive.

Brian,

You have all these 'wonderfu' ideas.  But who's going to pay for it?  The magic Leprechaun at the end of the rainbow?

And please, ok fine, we're going to have a tax free year.  So, just add more to our national debt -- which btw has to be eventually repaid -- through taxes!!!!

In other words we live a free ride now, while you amass debt for my daughter and unborn children.  Just to test Sir Allan's theory, are you in fact a Baby Boomer, or have you just learned from them really well?

I fail to see how so many people some how think that government spending money (and especially when going further in to debt to do so) is NOT an implied future tax INCREASE.

Oh... and during those tax free years, you said 3 of them, can I cash in every one of my investments, avoid all capital gains taxes, and relocate to the Cayman Islands?

I mean, the only thing that keeps me working is I can't afford to retire after the tax liability on cashing in all my investments.  If I can cash in, tax free and leave, well, cya later!  (naturally if taxes were gone permenantly I'd probably stick around, but that's another story all together).

I only bring up this point because do you seriously think that there wouldn't be an outflow of capital if it was known you had a once in a lifetime opportunity to cash out tax free?

What it is is BABY BOOMERS GONE WILD.

They presided over the most peace and prosperity in US history and SCREWED IT UP.

Now they want a FREE RIDE and spend my generations money, the Y generation and Z generations money to boot so THEY dont have to suffer.

I hope the first gen x president comes along and DENIES social security and any benefits to people born between 1946 to 1964 and take that money and pay down the debt.

We gen X and beyond DONT WANT YOUR 15 trillion dollar debt so YOU can have an easy ride thru retirement.

I don't get how you just fix a house's value????

THE WW2 GENERATION WAS THE GREATEST GENERATION!!!!!!      IF THE BOOMERS ARE SELFISH THEY WILL BE KNOWN AS THE WORST GENERATION!!!!!!!!!!!

The program will only be available for owner occupied and only one home and I guess I meet the definition of the Baby Boomers I just made it being born in 62. That's right imagine the effects that would have you would turn on the spiked of cash flow which is what we are reeling from now anyway Capital gains should be lowered but for one year capital gains (if you have any would not be taxed.

Sir Allan this is only an aberration in our history we have had others and we came out it in good enough shape to allow you to have an opportunity, but if you put in those terms we built for you build upon it and make it better, most boomers have worked long enough and paid enough to deserve Social Security. Everybody needs a free ride sometimes and I’m sure yours will come along but the Government is supposed to be for the people by the people we need to stop the Government from what it is currently doing.

Why not just give everyone their social security back...not like it will be there when I retire. 

The home’s value is fixed by its appraised value today and/or the sales price if purchased in the current year. For three years this is the property's value. This process creates the bottom in real-estate if property is bought and sold in this period it is at that value. Properties empty and foreclosed on also receive this fixed value - Wall Street can now value the assets in MBS's and began trading again, banks are no longer insolvent or carrying bad residential loans. After the adjustment there would be no more chances in those three years if a borrower becomes delinquent bankruptcy will not be an option, further more bankruptcy for individuals would not be allowed. In the event someone becomes delinquent because of illness, death, and/or loss of job banks would be mandated to offer a cooling off period in which no payment would be due for three months.         

Good idea blame the baby boom gen for all this. I know its their fault you are a cant make it. Get real....

The home’s value is fixed by its appraised value today and/or the sales price if purchased in the current year. For three years this is the property's value. This process creates the bottom in real-estate if property is bought and sold in this period it is at that value.

Ahhh... price controls.  Your 'solution' just gets better and better...

</sarcasm>

Did you ever happen to think that if a price floor is created, in your case 3 years, that perhaps potential buyers will opt to not buy until 3 years have passed?

Why not just give everyone their social security back...

Because it would cost more money to ship those stacks of IOUs than they're worth.

The home’s value is fixed by its appraised value today and/or the sales price if purchased in the current year. For three years this is the property's value. This process creates the bottom in real-estate if property is bought and sold in this period it is at that value.

So in other words, you will ban home sales.  Nobody would be stupid enough to pay the "fixed value" that would drop by 90% as soon as the price fixing period had ended.  Aside from the fact that the government will have collapsed in the meantime.

No, home sales will continue the plan called for the Gov't to enforce all lenders forgive all debt above 80% of that value. Instant equity is created so homes can sell.

So you'd be banning mortgages as well...

Home prices initially fell because of the foreclosures and continued because of the economy we are close to a deflationary scenario. For those who don't know Deflation is a persistent decrease in the general price level of goods and services. The term was used to refer to a decrease in the money supply and credit; Deflation is considered a problem because of the potential of a deflationary spiral and its association with the Great Depression. In other words prices fall so low they become unattractive so they are not purchased.

When you go thru an inflationary periods of DECADES of continual price increases and use the last 10 on CREDIT to sustain it, its HIGH TIME the whole thing collasped and deflated down to its true value.

You got economists world wide moaning and whining that we have to chuck not only the kitchen sink but every other sink in the house at the problem . Why? They dont WANT their investments to deflate back down to their true value.

Well guess what? You can chuck as much money at it as you want but its delaying the inevitable .

I'm talking about investors that are buying today they will be screwed if you lower everyones houses prices, not the investors that bought a few years ago. 

There isnt millions of qualified folks just sitting there waiting to buy a house. We got growing unemployment, mass deflation and record layoffs. We got shrinking lending and tightened qualifications.

We dont have enough buyers to buy right now, let alone the ever swelling inventory due to foreclosures.

Unless they bail these folks by CUTTING their principal down to keep them in their house, forget it. Housing will continue to decline.