How Much For An Eraser?
I was just reading a news article about help and the home owner dilemma, a real mess to be sure. President Obama was in my home state this month and addressed the government plan on funding to help struggling homeowners in foreclosure and this article was reporting on it. It shared how great the intentions are but how little good will come of it. The problems suggested are first, the number of homeowners that qualify for the aid are very small because the qualifications are so limiting and second, refinancing at a low interest rate over a longer period doesn’t solve the real problem because selling the home can’t recoup the debt. I agree with these problems.
I may have a school girl mentality, but this whole mess seems a lot easier and more basic to me than complicated economics algorithms. A mistake was made, but instead of erasing we’re piling on more scratch marks. The mistake involves two sides: the lenders and the buyers. Lenders created a stage of inflated home values, made it easy to buy into and buyers did. I use the term mistake loosely because cheating would likely apply with great accuracy. However, because there were a lot of innocent people affected I think I’ll stick with mistake here. I just want to know how much it would cost for an eraser? Why can’t we just erase the untrue and inflated values off existing mortgages? If we can pull billions of dollars out of thin air to ’stimulate’ our economy, why can’t we just erase what never existed? The banks can’t claim they’re losing because it was all make believe to begin with, in fact they’re at greater risk of default and losing by doing nothing.
Why can’t the good and honest people still paying on their mortgages be released from the cheating and lies of the industry controllers? You wouldn’t even need to refinance, just write off the unrealized inflation value that doesn’t exist anymore. This is the real problem and it’s what needs to be addressed. In fact, in my area a common scenario is a home costing $300,000 three years ago and those same homes are worth half that today. Nothing changed with the homes, just the make believe bubble surrounding them. Can you imagine having to sell and move knowing that you’d still owe $150,000 AFTER you’d sold your home? Neither can I.
So I’m just wondering how much an eraser would cost in all this. It seems like erasing not bailing is a better verb for this particular situation.
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I love history. The more I learn, the more I love. This week I’m reading The American Lion, Andrew Jackson in the White House. As soon as I saw this book’s title I knew I wanted to read it.
