In order for this Home Equity Plan to work they should lower the credit rating requirements. Like if you miss or are late for one payment since the job market is dead right now in some areas like California. If they don't have this it will not really help the people that really needs salvation.
as we know...even this gem found by CNBC went flying by...
so finding out exactly how this all is reported is yet another devil...
but shit, ya know, getting $40k, $80k or even $200k of debt wiped out with a "ding" on my credit report when you know that much reduction would raise a credit score a good 50 points....
uh, well, I'm quite pissed off at the moment that I did not sign up for a liar loan at the height of the bubble and get into something that was "interest only" for a good 5 years so I too could qualify for this new program!
Somehow I think they need just a wee bit more than a "income to debt ratio" means test!
It will depend on how the lender reports to credit bureau. Let me modify my statement: people may not get-off scot-free because it will depend on how they report it.
If the first and second lien holder is the same there is a good chance that it will be a negative report to credit bureau on second. Lenders will get their pound of flesh.
If the lien holders are different who knows. Lender/investor gets its money and that is all they care about.
Reaching Homeowners Before They Have Missed Payments: Delinquency will not be a requirement for eligibility. Rather, because loan modifications are more likely to succeed if they are made before a borrower misses a payment, modifications for households at risk of imminent default despite being current on their mortgage payments are eligible to participate, in addition to those who have fallen behind.
that's on p. 3 of the details document...
So, this is looking pretty damn exploitable...i.e. "hey, I'm over my head, or my property is now way below what I owe"...
government - "is your income not equal to 31% of what you owe?"...you - "why yes that's true!" - Bammo, well, you qualify!
Someone point out in this document where I am wrong because so far I'd like to scream...I did not buy an overinflated house because I knew I could not afford it....silly me!
we really need the original details at this point....but here goes:
1. they are allowing people to do this before even being late on one payment
2. they are paying off the loan holder, so there is no "write off" or bad discharge
So, those two things imply there would be no "bad mark" on the person's credit report. I've yet to see anything..even a lowering of 10 points (of course shopping at Walmart or using your credit card at bars will lower your score!)
I understand why you are assuming and saying what you are saying and obviously one would think you to be correct..
but so far in every analysis I have read, I see ways out so there would be nothing in the person's credit file to generate a negative report...
the fact their debt went down $40k, $80k just like that actually would raise their credit score.
You don't need a bankruptcy to have marks against credit. Lenders and other creditors are constantly reporting to credit bureaus info such late payments, defaults and how loan is paid off.
Credit card companies are doing it now with debt settlements. Credit bureaus will indicate how a loan was settled: paid in full, release thru bankruptcy, negotiated/settled, etc. This will impact peoples' credit scores.
People will not get off scot-free.
if anyone can find the official white house or treasury document where she (CNBC) is reading this fine print, link it up would you?
I can't find it and we need to double check these terms.
From what I read and she found is what I just posted earlier but to make sure we need to see the surrounding paragraphs and clauses....
if it's just within bankruptcy court, not so bad because bankruptcy should, will take most of your assets and that's before that absurd bankruptcy bill passed. I'm assuming they are just trying to undo that 2004 bankruptcy law and bankruptcy was never "fun" or something that forgave debt with no consequence in anyway.
that's not how I'm reading it....it's not in bankruptcy or elsewhere but before any bankruptcy...
it's a means test before even missing a payment as I am reading in-between the lines. and that means test is basically does your debt surrounding owning a home > 31% of your total income?
If it was in bankruptcy it would be somewhat different I think.
Middle column should still be highly informative expert level economics blogs, stats, indicators but better formatting and summaries only to actual site.
RSS inputs should be all formats, RSS, Atom, RSS2.
Additional traditional blog roll in some page somewhere for all of our friends and others making the effort.
Reminder, add:
Markets And Policy, which is currently only Atom feeds. A voice from the right who is technically accurate.
They won't deal with these issues of methods to labor arbitrage U.S. workers.
That's what I see. They are even trying to block enforcement of any kind to hire legal workers.
Where I live, the unemployment rate is over 10%, yet if I go to any of the shipyard areas, construction, even Burger King and McDonalds....all of these companies have a sea of illegal workers....
Will these various companies even consider a U.S. worker, an unemployed teenager, a middle aged woman? Not in a million years....it's like "all U.S. citizens need not apply" might as well be written on their doors.
It's beyond stupid and when will this shit end and they start looking at labor supply reality and do something?
Even worse, any attempts to put a domestic workforce first is hit with the most inane special interest B.S. I have ever seen.
I mean literally they are trying to claim that not allowing foreign guest workers to take American jobs is "discrimination". Can you believe that? Now the United States is "discriminatory" unless we allow the entire globe to take U.S. jobs?
It's just turned the original intent of diversity and discrimination into a mockery of the terms.
Millions of federal and state jobs are offshore outsourced, these are paid for with taxpayer dollars....
but the mention of doing a temporary freeze right now to employ U.S. workers with taxpayer money (that already exists, that would not expand the deficit) never even came up as a possibility.
They import 1.5 million foreign guest workers and literally we are hearing about "discrimination" because there was a token appeal that maybe jobs in the United States should first go to U.S. workers.
Does the U.S. consider a temporary freeze on these programs or reforming them to stop labor arbitrage? Of course not!
They will not acknowledge how the China trade agreement especially created a mass exodus of U.S. manufacturing and jobs to China and that in 2000 corporations could not labor arbitrage fast enough.
Don't even breath a word of this today in the press.
We heard a token "stop corporate tax incentives to offshore outsource jobs" but when the wage ratio is 100:1, 12:1, even 5:1, well, corporations are going to continue to wage arbitrage unless the government steps in with other policy.
The plan may slow foreclosure rate but the problem now is that with Jumbo loan market in trouble whether this too little too late.
I totally agree with wage-home price argument. Home prices will continue to drop because there are very very few buyers in the market. People are not going to buy a house if they are not confident about their job. What is so difficult to understanding? The problems we face are solvency, confidence and trust. So far, Geithner/Summers policies have done nothing to address these three issues.
Right now it seems they still are not "dying by the sword they set to live by". In other words when labor is involved we will hear all sorts of nonsense about creative destruction, but when it comes to businesses, multinational corporations the rules of creative destruction do not apply!
Or as we see the TARP it's more socialize the risk, privatize the profits.
Just as a concept, in terms of philosophy this is well said.
With Pension Funds over-valued, the American Baby Boomer will not be able to afford to retire. So now we have yet another reason to stop the H-1B visa program!
AIG is but the tip of the problem. CalPers and other public pensions are getting ready to topple. They've relied on excessive, inflated earnings from instruments like MBS's, and are now ripe to fall beneath huge underfunded actuarial weight. There's no way to fund these liabilities, except via phantom IOU's. The unborn children of India and China won't pay these legacy costs of former Colonialists, to be sure.
Etymology
First used in reference to the Asian Financial Crisis of 1997, possibly coined by the economist Edward Kane.
And, yeah, there are an awful lot of similarities to that situation and how it was handled, to our present day circumstances.
Fundamentally though, the concept of "money as debt", which is our current system, is doomed to failure since it depends upon everlasting and continuous growth. The Greenspan/Bush monetary expansion and credit bubble just accelerated the inevitable. This is the harsh reality that no government official wants to admit or perhaps feels they can be allowed to admit. Sooner or later though, it will become evident a paradigm shift is necessary. We have reached, if not surpassed, the limits to growth.
The WTO has a lot of bite, that's the whole reason so many want them dissolved. They have authority and ruling and to date on U.S. (of the little filed) complaints the rule against the United States. If the United States was not part of the WTO, they would not have to appeal to them and renegotiate terms directly and deal with violations directly.
In order for this Home Equity Plan to work they should lower the credit rating requirements. Like if you miss or are late for one payment since the job market is dead right now in some areas like California. If they don't have this it will not really help the people that really needs salvation.
as we know...even this gem found by CNBC went flying by...
so finding out exactly how this all is reported is yet another devil...
but shit, ya know, getting $40k, $80k or even $200k of debt wiped out with a "ding" on my credit report when you know that much reduction would raise a credit score a good 50 points....
uh, well, I'm quite pissed off at the moment that I did not sign up for a liar loan at the height of the bubble and get into something that was "interest only" for a good 5 years so I too could qualify for this new program!
Somehow I think they need just a wee bit more than a "income to debt ratio" means test!
It will depend on how the lender reports to credit bureau. Let me modify my statement: people may not get-off scot-free because it will depend on how they report it.
If the first and second lien holder is the same there is a good chance that it will be a negative report to credit bureau on second. Lenders will get their pound of flesh.
If the lien holders are different who knows. Lender/investor gets its money and that is all they care about.
that's on p. 3 of the details document...
So, this is looking pretty damn exploitable...i.e. "hey, I'm over my head, or my property is now way below what I owe"...
government - "is your income not equal to 31% of what you owe?"...you - "why yes that's true!" - Bammo, well, you qualify!
Someone point out in this document where I am wrong because so far I'd like to scream...I did not buy an overinflated house because I knew I could not afford it....silly me!
we really need the original details at this point....but here goes:
1. they are allowing people to do this before even being late on one payment
2. they are paying off the loan holder, so there is no "write off" or bad discharge
So, those two things imply there would be no "bad mark" on the person's credit report. I've yet to see anything..even a lowering of 10 points (of course shopping at Walmart or using your credit card at bars will lower your score!)
I understand why you are assuming and saying what you are saying and obviously one would think you to be correct..
but so far in every analysis I have read, I see ways out so there would be nothing in the person's credit file to generate a negative report...
the fact their debt went down $40k, $80k just like that actually would raise their credit score.
Link
You don't need a bankruptcy to have marks against credit. Lenders and other creditors are constantly reporting to credit bureaus info such late payments, defaults and how loan is paid off.
Credit card companies are doing it now with debt settlements. Credit bureaus will indicate how a loan was settled: paid in full, release thru bankruptcy, negotiated/settled, etc. This will impact peoples' credit scores.
People will not get off scot-free.
if anyone can find the official white house or treasury document where she (CNBC) is reading this fine print, link it up would you?
I can't find it and we need to double check these terms.
From what I read and she found is what I just posted earlier but to make sure we need to see the surrounding paragraphs and clauses....
if it's just within bankruptcy court, not so bad because bankruptcy should, will take most of your assets and that's before that absurd bankruptcy bill passed. I'm assuming they are just trying to undo that 2004 bankruptcy law and bankruptcy was never "fun" or something that forgave debt with no consequence in anyway.
that's not how I'm reading it....it's not in bankruptcy or elsewhere but before any bankruptcy...
it's a means test before even missing a payment as I am reading in-between the lines. and that means test is basically does your debt surrounding owning a home > 31% of your total income?
If it was in bankruptcy it would be somewhat different I think.
These people will have huge marks against their credit so there are consequences to even second mortgage forgiveness.
This not a sure thing because second lien holder may not agree especially if lien holders are different parties.
I have my LOC check book out now. Whoopee! I don't really like my house anyway.
Middle column should still be highly informative expert level economics blogs, stats, indicators but better formatting and summaries only to actual site.
RSS inputs should be all formats, RSS, Atom, RSS2.
Additional traditional blog roll in some page somewhere for all of our friends and others making the effort.
Reminder, add:
Markets And Policy, which is currently only Atom feeds. A voice from the right who is technically accurate.
They won't deal with these issues of methods to labor arbitrage U.S. workers.
That's what I see. They are even trying to block enforcement of any kind to hire legal workers.
Where I live, the unemployment rate is over 10%, yet if I go to any of the shipyard areas, construction, even Burger King and McDonalds....all of these companies have a sea of illegal workers....
Will these various companies even consider a U.S. worker, an unemployed teenager, a middle aged woman? Not in a million years....it's like "all U.S. citizens need not apply" might as well be written on their doors.
It's beyond stupid and when will this shit end and they start looking at labor supply reality and do something?
Even worse, any attempts to put a domestic workforce first is hit with the most inane special interest B.S. I have ever seen.
I mean literally they are trying to claim that not allowing foreign guest workers to take American jobs is "discrimination". Can you believe that? Now the United States is "discriminatory" unless we allow the entire globe to take U.S. jobs?
It's just turned the original intent of diversity and discrimination into a mockery of the terms.
Millions of federal and state jobs are offshore outsourced, these are paid for with taxpayer dollars....
but the mention of doing a temporary freeze right now to employ U.S. workers with taxpayer money (that already exists, that would not expand the deficit) never even came up as a possibility.
They import 1.5 million foreign guest workers and literally we are hearing about "discrimination" because there was a token appeal that maybe jobs in the United States should first go to U.S. workers.
Does the U.S. consider a temporary freeze on these programs or reforming them to stop labor arbitrage? Of course not!
They will not acknowledge how the China trade agreement especially created a mass exodus of U.S. manufacturing and jobs to China and that in 2000 corporations could not labor arbitrage fast enough.
Don't even breath a word of this today in the press.
We heard a token "stop corporate tax incentives to offshore outsource jobs" but when the wage ratio is 100:1, 12:1, even 5:1, well, corporations are going to continue to wage arbitrage unless the government steps in with other policy.
The plan may slow foreclosure rate but the problem now is that with Jumbo loan market in trouble whether this too little too late.
I totally agree with wage-home price argument. Home prices will continue to drop because there are very very few buyers in the market. People are not going to buy a house if they are not confident about their job. What is so difficult to understanding? The problems we face are solvency, confidence and trust. So far, Geithner/Summers policies have done nothing to address these three issues.
Man I dig a well punctuated rant. Bravo!!
It has always been about class warfare.
Right now it seems they still are not "dying by the sword they set to live by". In other words when labor is involved we will hear all sorts of nonsense about creative destruction, but when it comes to businesses, multinational corporations the rules of creative destruction do not apply!
Or as we see the TARP it's more socialize the risk, privatize the profits.
Just as a concept, in terms of philosophy this is well said.
I especially like the poker analogy in the title.
With Pension Funds over-valued, the American Baby Boomer will not be able to afford to retire. So now we have yet another reason to stop the H-1B visa program!
AIG is but the tip of the problem. CalPers and other public pensions are getting ready to topple. They've relied on excessive, inflated earnings from instruments like MBS's, and are now ripe to fall beneath huge underfunded actuarial weight. There's no way to fund these liabilities, except via phantom IOU's. The unborn children of India and China won't pay these legacy costs of former Colonialists, to be sure.
According to Wiktionary:
And, yeah, there are an awful lot of similarities to that situation and how it was handled, to our present day circumstances.
Fundamentally though, the concept of "money as debt", which is our current system, is doomed to failure since it depends upon everlasting and continuous growth. The Greenspan/Bush monetary expansion and credit bubble just accelerated the inevitable. This is the harsh reality that no government official wants to admit or perhaps feels they can be allowed to admit. Sooner or later though, it will become evident a paradigm shift is necessary. We have reached, if not surpassed, the limits to growth.
The WTO has a lot of bite, that's the whole reason so many want them dissolved. They have authority and ruling and to date on U.S. (of the little filed) complaints the rule against the United States. If the United States was not part of the WTO, they would not have to appeal to them and renegotiate terms directly and deal with violations directly.
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